1
Business Plan for a Consumer Electronics Accessories Company
Nyack College
Master of Business Administration
Submitted to:
Professor Joseph Reid
Submitted by:
Myron M. Brown
112-04 177th Street
Jamaica, New York 11433
Home Telephone:
718-526-5090
Mobile Telephone:
917-882-4906
Email Address:
[email protected]
Course Location:
Rockland Campus
Submission Date:
October 09, 2014
Capstone Project Title:
Business Plan for a Consumer Electronics Accessories Company
CERTIFICATE OF AUTHORSHIP:
I certify that I am the author of this paper and any assistance I receive in its preparation is fully
acknowledged and disclosed in this paper. I have also cited any sources from which I used data,
ideas, or works, either directly quoted or paraphrased. I also certify that this paper was prepared
by me specifically for this course.
Student's E-Signature:
____Myron M. Brown___________________________
Advisers Comments:
2
Business Plan for a Consumer Electronics Accessories Company
Business Plan: Consumer Electronics Accessory Company
Myron M. Brown
Submitted in partial fulfillment
of the requirements for the degree
Master in Business Administration
School of Business and Leadership
Nyack College
September 2014
Capstone Committee
Dr. Gerard Becker, MBA Director
Professor Joseph Reid, Capstone Advisor
3
Business Plan for a Consumer Electronics Accessories Company
Table of Contents
Executive Summary ........................................................................................................................ 6
Mission, Vision, Core Values ......................................................................................................... 8
Industry and Proposed Company .................................................................................................. 11
Industry Overview ..................................................................................................................... 11
Proposed Company ....................................................................................................................... 18
Products and Services ................................................................................................................... 20
Market Analysis ............................................................................................................................ 27
Overview ................................................................................................................................... 27
Customers ..................................................................................................................................... 36
Competing Products ...................................................................................................................... 39
Conclusion ................................................................................................................................. 41
Economics of the Business ........................................................................................................... 43
Marketing Plan .............................................................................................................................. 52
Conclusion ................................................................................................................................. 61
Design and Development Plan ...................................................................................................... 63
Manufacturing and Operations Plan ............................................................................................. 68
Management Team ....................................................................................................................... 71
Sustainability and Impact.............................................................................................................. 74
Overall Schedule ........................................................................................................................... 77
Risks, Potential Obstacles and Assumptions ................................................................................ 79
Financial Plan ............................................................................................................................... 88
Proposed Funding Requirements .................................................................................................. 92
Summary ..................................................................................................................................... 100
References ................................................................................................................................... 101
4
Business Plan for a Consumer Electronics Accessories Company
List of Tables
Table I: Start-up Expenses .......................................................................................................43
Table II: Fixed Costs................................................................................................................44
Table III: Variable Costs.........................................................................................................45
Table IV: Break-Even Analysis ...............................................................................................46
Table V: Anticipated Sales - 3 Year Forecast ..........................................................................48
Table VI: Market Sensitivity Scenarios .................................................................................. 49
Table VII: Cash Flow Analysis................................................................................................50
Table VIII: Operations Schedule .............................................................................................77
Table IX: Fixed Costs over 3 Year Period ...............................................................................88
Table 1X: Salary Breakdown for 3 Year Period ......................................................................88
Table XI: Pro Forma Income Statement for 3 Year Period. ....................................................89
Table XII: Pro Forma Balance Sheet for 3 Year Period ..........................................................90
5
Business Plan for a Consumer Electronics Accessories Company
List of Figures
Figure 1: Global Mobile Subscription Saturation Chart ..........................................................12
Figure 2: Global Mobile Penetration .......................................................................................12
Figure 3: The Coin Cell Battery...............................................................................................21
Figure 4: The Mobile Power Handset Gap ..............................................................................28
Figure 5: U.S. Smartphone Penetration by Ethnicity...............................................................29
Figure 6: Top U.S. Smartphone Operating Systems by Market Share. .................................. 30
Figure7: Top Categories of Cell Phone Accessories 2011-2012 .............................................37
Figure 8: Patent Litigation Chart .............................................................................................83
6
Business Plan for a Consumer Electronics Accessories Company
Executive Summary
Semper Five, LLC (Limited Liability Corporation), referred to throughout this document
hereafter as “Semper Five,” is a consumer electronics accessories company that will design and
market a collection of external battery charger devices for the consumer electronics (CE)
accessory market. Semper Five’s entry into this market will be through the mobile device market
segment, with initial products directed at the Smartphone user. However, the Semper Five design
model translates well to additional popular mobile consumer electronic devices such as tablet
and laptop computers, in addition to e-readers.
The continuing evolution of mobile technology has transformed portable CE devices
from simple communication devices, into essential tools for global socialization, productivity
and entertainment. As Smartphones, laptop and tablet computing devices increase their power,
application and utility parameters, these devices will also require and employ more battery
power. This issue has resulted in Smartphone users and buyers citing battery life as the most
important feature they look for in a new Smartphone purchase, eclipsing ease of operation and
device operating system (Reed, 2014). Faced with the limitations of current battery technology,
mobile device manufacturers as well as the mobile consumer are looking at other means of both
improving and extending battery life (Smith, 2003).
Semper Five will differentiate itself from competing products by producing a line of
simple to use, self-contained external battery charging devices that function without the need for
an auxiliary power source or other power transmission accessories. The company’s collection of
battery charging devices will trade on the global Smartphone and mobile device users need for
extended battery life and utility. Designed for the mobile user, Semper Five products will enable
the consumer to charge their mobile devices without the need for an electrical outlet, power
7
Business Plan for a Consumer Electronics Accessories Company
adapter, USB (universal serial bus) cable or charging station. As such, Semper Five external
battery charging products offers the Smartphone user a reliable, genuinely “wireless” recharging
option. Semper Five products, designed with ease of operation, a 7-10 year shelf life and on the
go charging in mind, will allow the mobile device user to charge their devices and provide
“faithful” service under any contingency – anywhere and at any time.
Semper Five products are fully capable of exploiting the weaknesses inherent to the
current market of mobile device external battery chargers, rewarding the user with the
opportunity to exploit the uninterrupted virtues of their Smartphones. Its wireless design
enhances the utility, function and operational longevity of Smartphones, offering the mobile
consumer the opportunity for uninterrupted smartphone operation. The designs easy translation
and adaptation for other mobile device platforms will ensure this venture’s sustainability and
longevity. The current global mobile subscription saturation rate (6.9 billion global mobile
subscribers) and integration of mobile technologies into daily practice of business and citizenry
worldwide, coupled with the mobile users need to recharge their devices in exigent circumstance,
creates an amazing customer base and fiscal opportunity. This enterprise will change the manner
in which the world uses mobile technology, eternally alter the wireless charging paradigm, and
the manner in which the world works, plays and interacts. Semper Five product line is
representative of that next great disruptive force in mobile technology - perpetual operation.
Mobile device battery life is the final hurdle in the evolution of CE mobile device and
smartphone evolution. Whoever can solve the battery longevity dilemma first will see enormous
financial gains (Manjoo, 2012). Semper Five is poised to reap these rewards.
8
Business Plan for a Consumer Electronics Accessories Company
Mission, Vision, Core Values
Mission
As a new entry in the consumer electronics accessories market’s external battery charging
segment, Semper Five’s mission is to produce products that will give its customers the power of
uninterrupted operation. The company will continuously produce products every customer
deserves – products founded in overall value built upon a platform of form, function, price,
service, convenience and power. Yet the true mission of Semper Five is infusing its products
with these attributes, in pursuit of the mobile consumers’ greatest wish…perpetual mobile
operation.
Vision
In 3 years, Semper Five envisions itself as a brand that will be on every mobile device
users’ lips as the first name in external battery charging accessories. This company intends to
redefine the phrase “wireless battery charging” and “mobile device” in global CE market
lexicon. In lieu of searching for an electrical outlet, cables and adapters or available charging
station, mobile users’ around the world will reach for Semper Five products whether at home, the
office or on the go. This company will be the premier brand in mobile device charging,
impacting consumer electronics and mobile telecommunications as industries. Semper Five will
grant the global mobile consumers’ wish for uncompromising reliability, “faithful” product
service and enhance their user experience with the opportunity for unfettered, uninterrupted
mobile service.
Core Values
Steve Jobs, co-founder of Apple, Incorporated, was once asked what he thought was his
most important creation, with the interviewer assuming he would respond by designating an
9
Business Plan for a Consumer Electronics Accessories Company
Apple product. Instead, Jobs said it was Apple Incorporated, the company. “Making an enduring
company,” he said, “was both far harder and more important than making a great product.”
(Isaacson, 2012).
Semper Five is founded upon the same principal as the United States Marine Corps
creed, SEMPER FIDELIS – “always faithful.” The Semper Fidelis motto embodies the intent,
purpose and mission of this enterprise. Our core values extend beyond faithful operation of the
product line, but also include faithful and reliable customer loyalty and service. This spirit of
trustworthy and dependable service epitomizes the Semper Five product lines, but also its
operational direction – to insure our customers have 5 bars on the mobile device power scale and
an opportunity for perpetual mobile service. By doing so, Semper Five has created a new
opportunity in the CE accessory market, and introduced a potentially disruptive technology.
However, with this opportunity also brings greater responsibility, and a greater obligation to
serve the global community at-large.
Beyond its obligation to its customers, Semper five will embrace the Semper Fidelis
ethos in its business practices, supply chain and its work force. Each of the aforementioned
elements will be endorsed as valuable participants in the success of this company. For most
firms, human capital represents one of their largest investments and presents one of the most
difficult resource management challenges. Corporations have struggled for years to try to
quantify human capital and its impact on organizational performance. People Equity can be a
powerful framework for examining investments in human capital and for determining their
impact on customer and shareholder value (Metrus Group, 2013).
In this regard, Semper Five will separate itself from its competitors due to its practices of
innovation, marketing and operational excellence. Using a business model that maintains the
10
Business Plan for a Consumer Electronics Accessories Company
ideology and environment of a new entrepreneurial enterprise throughout its existence, Semper
Five will further the company’s sustainability and market leadership. It will avoid the pitfalls of
many businesses in the technology sector through its continuous in-house innovation, customer
orientation, user-friendly product design and aesthetics, and dedication to product differentiation.
This will be achieved by embodying the startup venture culture, with a casual dress
policy and work setting, creating an atmosphere where the work force embraces Semper Five as
a fun place to work, Nonetheless, the CE mobile accessory market is highly competitive, where
innovation, customer service, logistics (production, distribution and speed to market), and high
product quality are imperative to a venture’s sustainability. This market is also subject to
competitor product imitation, patent challenges, and product innovation (Bhimrajka, 2007).
When called to perform in such a demanding environment, a workforce that considers
themselves amongst the best in the technology industry must stand and deliver. At Semper Five,
workforce excellence is not only an expectation, but an obligation. However, Semper Five’s
relaxed atmosphere will be founded upon a “work hard, play hard” work ethic. In order to enjoy
sustainable success, Semper Five will reward workforce innovation and do so in a proactive and
resourceful environment. “The key is envisioning what tomorrow looks like – or how you can do
things better, but differently” (Michael, 2013). This translates into the creation of new products,
improving existing products and extension of the product line beyond consumer mobile devices
and smartphones. Each functional element of the venture must continuously participate in the
innovation cycle (Schiemann, 2009).
11
Business Plan for a Consumer Electronics Accessories Company
Industry and Proposed Company
Industry Overview
In 2002, the telecommunications industry reached an incredible and unforeseen
milestone. For in 2002, the number of mobile telephone service subscribers overtook the number
of landline subscribers….worldwide (ITU, 2003). The year 2002 also marked the beginning of
the cellular telephone as a not only a telecommunication service item, but also as a tool for
economic development and as a social icon. Even more remarkable, this trend has taken place
without geographical, demographical or socioeconomic limitation.
At the initiation of this business plan in 2012, The International Telecommunications
Union (ITU), a specialized agency of the United Nations responsible for the coordination of
information and communication technologies, estimates indicated approximately 6 billion mobile
service subscribers worldwide. A startling figure because it represented approximately eightyseven percent (87%) of the world’s population in 2012, and a dramatic increase from 4.7 billion
mobile subscriptions in 2009 (ITU, 2012). The most current mobile saturation estimates, indicate
global mobile service subscriptions are approaching the 7 billion mark. With a world population
estimated to be 7.1 billion, mobile saturation may reach a point where it is representative of one
smartphone or other mobile telecommunication device for each of the globe’s inhabitants.
(mobithinking.com, 2013). These figures are indicative of the potential for every citizen of the
world someday possessing a mobile device, and evidence of the impact of mobile
telecommunications technology.
12
Business Plan for a Consumer Electronics Accessories Company
International Telecommunications Union, 2012
Figure 1: Global Mobile Subscription Saturation
Since its introduction, the mobile telephone has become firmly entrenched as a globally
indispensable electronics device. The ever evolving utility, versatility and connectivity of mobile
technology have transformed these devices from simple communication device and luxury
accessory, into a daily essential tool. As mobile device capabilities evolved, the global mobile
users have also evolved and now embrace their mobile handsets. Currently, the mobile handset
has evolved into the Smartphone, and manufacturers now stuff these devices with more and
greater features, speed, functions and applications such as cameras, stereo speakers, high
Global Mobile Penetration
definition monitors, Bluetooth and Internet connectivity.
Figure 2: Global Mobile Penetration 2002-201 International Telecommunications Union, 2012
13
Business Plan for a Consumer Electronics Accessories Company
In its current configuration, smartphone design has reached a point in its evolution where
the computing power and utility of these devices nearly rivals that of many desktop and laptop
computers. Subsequent generations of smartphone design will undoubtedly be greater,
introducing a new wave of speed, features and operational capabilities. Smartphone
manufacturers future design paradigms will continue to incorporate an array of power sapping
monitors, cameras and faster processors into ever lighter and thinner devices. This practice
appears to further challenge the limits of currently available battery technology, without any
available improvements in the foreseeable future (Mott, 2013). For all the aforementioned
operational features and benefits inherent in smartphone design come with a hidden cost –
greatly reduced battery life.
Industry
The mobile consumers’ demand for increased battery and operational longevity has been
both a bonus and nuisance for the external battery makers. The problem is that increased
functionality requires increased power and power management needs (Brush, 2004). The CE
accessories industry has sought to meet this need thorough a number of charging options and
vehicles to meet the global mobile handset users’ cry for more power. There’s a huge market for
mobile battery chargers: plug-in power adapters, external battery cases and power banks and
“wireless” charging stations. Other charging platforms are gimmicky or unusual, such as solar
charging panels and devices or hand-cranking power adders (Henry, 2013). Each of the
aforementioned charging vehicles is an attempt to answer the mobile users’ paradox of mobile
charging. And each is dependent upon an external and/or auxiliary power source for operation.
While the battery manufacturing industry has been the focus of this power issue, the
global mobile consumers’ need for battery power and operational longevity extends beyond the
14
Business Plan for a Consumer Electronics Accessories Company
battery itself (Cooper, 2001). The inherent power limitations of the mobile device battery and the
mobile users’ desire to maintain continuous service and operation of the smartphones and other
mobile devices has not been lost on the battery manufacturers, mobile handset manufacturers,
mobile service providers nor the consumer electronics accessories industries. Each has attempted
to resolve the global mobile device users’ charging dilemma (Woojoo, Yanzhi, Donghwa, Chang
& Pedram, 2015).
The mobile handset manufacturers have addressed the power depreciation issue by
incorporating over minimization and dynamic power management techniques to improve the
power efficiency of various operation modules, such as processors, memory, screen display, and
GPS (Global Positioning System) processors, inside a smartphone platform (Woojoo, Yanzhi,
Donghwa, Chang & Pedram, 2015). An example of this philosophy is the “Battery+” app,
designed to maximize utilization of the user’s smartphone battery and alleviates the expense of
purchasing or carrying an external battery product. The app’s biggest feature is that it
automatically deactivates the smartphone’s LTE (Long Term Evolution), Wi-Fi and Bluetooth
features if there is no connection nearby, which will ensure the user’s handset does not waste
energy as the device attempts to connect to networks that are not within its range (Reed, 2014).
Well aware that battery life is the biggest issue for consumers and attempting to make
their devices more efficient, the mobile handset manufacturing and CE industries, in conjunction
with CE industry associations, examined the mobile phone user’s recharging issue. This resulted
in a CE industry resolution for an international charging standard. Effective January 2010, the
major cellular telephone manufacturers established an international standard for mobile device
handsets that will use a standardized charger based on the micro-universal serial bus (USB)
connector. Initially implemented in Europe, the new standard was quickly implemented for
15
Business Plan for a Consumer Electronics Accessories Company
handsets directed for the North American cellular markets. The agreement for using a
standardized charger has been endorsed by companies including Apple, LG, Motorola, Nokia,
RIM, Samsung and Sony Ericsson (Bertolucci, 2009).
Mobile service providers (MSPs) are as aware of the mobile device power issue, and
absorb the brunt of consumer complaints and ire regarding battery power. Each has addressed
their customers’ power issues as conscientiously as possible, using their service representatives
and websites as information sources. Each MSP makes the consumer aware of the power
capacity, both in terms of battery size (capacity) and estimated runtime for each manufacturer’s
devices in their product description. In addition, each MSP also offers user operation tips and
suggestions for extending battery life and operational runtime. This is in addition to offering a
collection of mobile power accessories, such as extra batteries, external battery cases, and
external power banks (verizonwireless.com, 2014).
Each of the aforementioned industries has long been aware that battery life is the greatest
concern for consumers and are attempting to make their devices more efficient (Cooper, 2001).
Solutions to the power quandary are being developed by each of the related industries, with
many already working in tandem. Battery manufacturers and mobile handset manufacturers are
working feverishly to resolve this power issue, investing substantial time and resources. While
the battery industry is investigating and developing a myriad of battery chemistries and delivery
formulas, the handset manufacturers are developing mobile device electronic components and
operational processes and applications (aps) that may offer respite. The most logical approach
revolves around device power management through better, more efficient electronic components
and standardization of power measurement methods relating to battery life (Brush, 2004). Yet
even this does not address the mobile device users, particularly the smartphone users’ need to
16
Business Plan for a Consumer Electronics Accessories Company
recharge their devices regularly nor on demand.
Significance
Globally, this is The Age of the Smartphone. Mobile technology has transformed the
smartphone into a timepiece, alarm clock, camera, calculator, biometric measuring device,
entertainment center, computer, library, road map, social engagement tool amongst other things.
In doing so, the smartphone has disrupted each of the business and social paradigms associated
with each of the aforementioned functions. And this list will only continue to grow at the
smartphone continues evolve and designers add even more functions, applications and
capabilities to their devices. As this occurs, the smartphone and mobile technology will become
an even more integral part of how the global citizen does business and lives.
For the smartphone user, managing the battery life of our mobile devices is a neverending challenge and dilemma of ownership. Everyone who uses a smartphone or mobile device
is familiar with the angst connected to being in a public space with the device’s battery running
out of power. Every smartphone user can relate to looking at their device, seeing the dreaded
single “red” bar and wondering where the other four bars have gone. Every mobile device user
can also relate to the stressful and heated search for a power outlet or passing the device and
charging adapter across a counter or bar for charging. Or upon learning you don’t have the
appropriate charging device or cables, the frantic asking of friends, acquaintance, strangers
and/or the hotel desk if they had the foresight to possess a charging mechanism – and the
wisdom of purchasing the same device. Every mobile traveler can recall the aggravation of
ensuring the hodgepodge of chargers, USB (Universal Serial Bus) cables and cords is packed
along with their clothing and toiletries.
In this era of mobile devices, it has been rather ordinary to see mobile users at
17
Business Plan for a Consumer Electronics Accessories Company
restaurants, coffee shops and airports jockeying not for the best seat, but vying for seats closest
to wall outlets or charging stations. Occasionally, the unfortunate can be found waiting in line for
the opportunity to charge their mobile devices. In our “always on – always connected” digital
world, charging any smartphone or mobile device on the go is a necessity. However, keeping a
portable charging device available and/or fully charged, and constantly plugging and unplugging
your smartphone can be more than a little annoying, it can occasionally be impossible.
Fortunately, the utility of the smartphone and the family of mobile devices appears limited only
by the batteries that power them, and the mechanism the consumer selects to recharge them.
This scenario is further complicated by the fact that rechargeable batteries, over time and
with usage, lose charging capacity because their materials lose their structure in response to
charging and discharging. As every owner of a mobile phone knows, batteries fade, storing less
and less energy each time they are charged. This is the result of the degradation of the batteries
chemistry as its components strength is depleted. Unfortunately, current battery chemistry cannot
resolve the eventual depletion of the chemicals that comprise the battery. Over time, a
smartphone battery capacity declines to the point that it has to be replaced, at both a financial
cost to the consumer or, if the old battery is improperly disposed of, our environment (Wang, Gu,
Zhou, Zu, Connell, Xiao, Perea, Lauhon, Bang, Zhang, Wang, & Gao. (2014).
If one searches any of the Internet search engines, the searcher will find a plethora of
solutions, tips and products addressing the smartphone power debacle. A recent search of
Google.com, a popular search engine, revealed over 16 million results for “Smartphone external
battery” (Google.com, 2014). A similar search at an e-commerce retailer, Amazon.com,
produced over 227 thousand results with products from over 15 manufacturers. Additional
searches were conducted for “”smartphone battery charger” and “smartphone power” produced
18
Business Plan for a Consumer Electronics Accessories Company
results totaling greater than 297 thousand and 978 thousand with over 30 manufacturers
respectively (Amazon.com, 2014).
Still, while the CE accessories market segment for mobile device external battery
chargers appears crowded, each of the currently available external battery charging devices and
formats - charging/power adapters, external battery cases and power banks, “wireless” charging
stations, et al – all have the same liability: dependence upon an external primary power source to
operate. A self-contained external battery design, which operates without the necessity of a
primary electrical power source for operation, a truly “wireless” charging option will assuredly
revolutionize the power and CE market, and quell the mobile consumers’ global cry for
continuous operation and function in smartphones and other mobile devices
Herein lays the market opportunity for Semper Five to trade on the popularity, utility and
saturation of smartphone technologies, offering the global mobile consumer a truly wireless
external battery accessory capable of extending their smartphone’s operational longevity and
performance. Semper Five’s goal is to provide the mobile consumer, particularly the smartphone
user, with the power and convenience of perpetual operation and performance from their mobile
devices.
Proposed Company
McKinsey and Company’s Global Institute, a division of the globally recognized
management consulting firm, conducted research that identified energy storage devices or
physical systems that store energy as one of twelve “disruptive technologies” that will impact the
economy and shape the future (Consumer Electronics Association, 2013). Semper Five product
design is demonstrative of the next great disruptive force in the CE Mobile Accessories external
battery charging market segment. Semper Five’s products’ power capacity and self-contained,
19
Business Plan for a Consumer Electronics Accessories Company
wireless design will meet the power needs of the mobile consumer, allowing their smartphone
and/or other mobile devices to be charged and perform anytime, anywhere and under any
circumstance. This is the real advantage of a truly “wireless” charging system as represented by
Semper Five products.
Semper Five, as a business venture, represents a vehicle for enhancing the global
smartphone and mobile device users’ operational experience by extending their devices’ battery
life. The company’s self-contained external battery design and product line will provide an
opportunity to employ the global mobile consumers’ adoption of mobile telecommunications
technologies to create a new CE accessory market opportunity.
Semper Five strategic approach to growing this enterprise and achieving sustainable
competitive advantage is to employ a low cost leader strategy offering the lowest pricing
possible for the company’s products. However, Semper Five will outperform competitors by
offering the consumer products that are not only lower cost, but possess higher quality and
greater value. Semper Five’s array of mobile device power accessories features design aesthetics
that include ease of operation, high power capacity and incorporates a genuinely wireless design
platform. Semper Five designed products will increase the performance and service life of the
customer’s smartphone, answering their demand for continuous function and perpetual operation
in this digital age. Moreover, properly executed, Semper Five wireless external battery design
has the potential to disrupt the present mobile device charging model, influence consumer
smartphone usage patterns, the mobile telecommunications and consumer electronics industries.
20
Business Plan for a Consumer Electronics Accessories Company
Products and Services
Semper Five represents the next step in the evolution of Smartphone external battery
chargers as the first charging accessory that totally frees the user from electrical outlets, charging
stations and device specific power adapters/cables. Its product line represents a vehicle for truly
“wireless” smartphone and mobile device charging platform. As such, Semper Five creates the
opportunity for every traveler, outdoor enthusiasts, and global mobile subscriber from every
corner of the world to stay connected, informed and/or entertained at anytime, anywhere and
under any contingency. This will be accomplished by a design model that no longer adheres to
the current external battery charging paradigm that relies upon the lithium ion (li-ion) and
lithium polymer (li-polymer) battery technology presently used by current smartphone
manufacturers and competing products. Instead, Semper Five products will rely on the power
and storage capacity of another, proven battery chemistry.
Semper Five product line will differentiate itself from its competitors by using lithium
coin cell battery technology to power its product line. Coin cell batteries (also known as button
cell batteries), were first introduced in the early 1980’s and are denoted by their round, more
compact cell design (batteryuniversity.com, 2014). Lithium coin cell batteries are generally used
to power small devices such as remote controls, garage door openers, medical equipment,
personal digital assistant devices (PDAs), computer memory power, toys and games, GPS
devices, and many other electronic applications. Lithium coin cell batteries are 3 volt (3v) cells
which can be used as a single source of power or can be used in multiples to create higher
voltages (batteryprice.com).
21
Business Plan for a Consumer Electronics Accessories Company
Figure 3: Coin Cell Battery
batteryuniversity.com, 2013
Semper Five selected the coin cell battery as it device power source because it is a
compact sized, light weight, high energy, highly reliable battery that produces about twice the
amount of energy of comparable dry batteries. The 3v coin cell battery which will be primarily
utilized for production has a battery industry designation of CR2477, with a nominal energy
storage capacity of 950-1000 mAh (milliamp-hour). Milliamp-hour (mAh) refers to the unit of
measure for electrical energy a battery can store at one time (phonescoop.com, 2014).
Coin cell lithium batteries also offer Semper Five the advantage of small size and ease of
stacking to increase voltage/power available for its products. In the CR2477 configuration to be
used during production, the batteries has dimensions of less than one inch wide and one-quarter
inch high (0.94” x 0.24”), and weigh less than one-half ounce (0.37 ounces). Additionally, coin
cell battery technology allows for a strong, stable load pulse for both long-term applications and
high-drainage devices, such as smartphones. The CR2477 coin cell battery also features a low
self-discharge rate, ensuring long service and estimated shelf-life of 710 years, coupled with
compact size, light weight and a wide operating temperature range of -30 degrees to +60 degrees
Celsius (-22 degrees to +140 degrees Fahrenheit). However, manufacturers also produce coin
cell batteries in 500 mAh (CR2032) and 600-620 mAh (CR2450) power capacities, which may
be used in similar fashion as a standalone power option or stacked in multiples per product
22
Business Plan for a Consumer Electronics Accessories Company
application (batteryjunction.com, 2014)
Although small, inexpensive to build, and possessed of a large storage capacity the coin
cell battery fell out of favor. A drawback of the coin cell battery is swelling if charged too
rapidly in a rechargeable format. This is due to coin cell batteries having no safety vent and can
only be charged at a 10 to 16-hour charge rate. However, newer designs reverted to more
conventional battery configurations and are not rechargeable. The coin cell batteries in use today
are non-rechargeable and can be found in medical implants and other devices, watches, hearing
aids, car key fobs and consumer electronics memory backup (batteryuniversity.com, 2014).
The CR2477 coin cell battery Semper Five will employ in the production of its products
are the newly configured, non-rechargeable variety. In its this configuration, the use of the
CR2477 coin cell battery will allow Semper Five to produce an external battery charging case
with a power capacity range of 2,000 – 8,000 mAh. This is remarkable in the present consumer
electronics accessory market where the most popular rechargeable devices have a power capacity
range of 1,500 – 2,500 mAh (Mophie.com, 2014).
Product Descriptions
Semper Five product line has been conceived with the smartphone users power and
recharging needs in mind, enhancing the portability and operational capabilities of their mobile
devices. At the onset, the company will offer products directed at the global smartphone handset
users’ need for maintaining perpetual operation and wireless utility. These products, The MyRun
and The Marathon Series, will provide the mobile handset user with options to charge their
devices in any contingency.
23
Business Plan for a Consumer Electronics Accessories Company
The first collection of Semper Five’s product designs are detailed below:
The Marathon Series
The Marathon Series is designed to compete directly with the present crop of smartphone
external battery cases currently in the CE smartphone accessories market. The Marathon Series
will offer the user the benefits of a stylish shock-resistant smartphone case, coupled with the
charging capability of an external battery pack. Like its little brother, The Marathon Series will
also employ coin cell battery technology, and offer the user the option of perpetual operation on
a grander scale.
The Marathon, will represent a smartphone battery case with an 8,000 mAh power
capacity, allowing the user to fully charge their 1450 mAh battery device 5 and one-half times –
offering approximately 50 hours of runtime. Customers with smartphones possessing a 2500
mAh battery capacity will have approximately 3.2 charges available, and enjoy a potential 45
hours of additional runtime.
The Marathon2, with its 16,000 mAh capacity, will provide approximately 100 hours of
uninterrupted runtime, in addition to a little over 6 -10 full recharging cycles. Ease of operation
and utility will be enhanced by the Marathon Series’ integrated On/Off power switch and power
meter, which will allow the consumer to protect their device and charge when necessary – yet
always be conscious of the power on hand when needed. Much like a traditional handheld
flashlight, the 7-10 year shelf life of every Semper Five external charging accessory will provide
power on demand and afford every smartphone and mobile device user genuine wireless
charging and perpetual operation.
The MyRun Series
The MyRun and MyTaxi external battery devices are designed and developed as a short-
24
Business Plan for a Consumer Electronics Accessories Company
term, emergency charging option. As such, each is intended to offer the smartphone user the
option of continued service without the need to stop and charge their device. This will allow the
active or busy smartphone user the luxury of continuous operation, without being tethered to a
stationary power source or carry charging devices or cables.
The MyRun Series devices are intended for those uncomfortable and unforeseen
occasions when the battery power indicator has gone red, yet there is no time or place for wired
recharging. Their small size, light weight and plug-and-play design features will make it suitable
for purse or pocket storage, and offer the consumer practical charging and field utility. The
MyRun 2000 mAh power capacity will add approximately 138% of battery life, representing
approximately 12 hours of additional run-time or almost 1 and one-half charges to a 1450 mAh
capacity battery device.
The MyTaxi external battery accessory, with its 1000 mAh power capacity, augments a
1450 mAh smartphone battery by 69% of capacity, offering the smartphone user enough power
to get home and fully recharge. The intent is to top off the power band of a nearly depleted
smartphone, providing the device user with hours of continued service. The MyRun Series
external battery accessories will provide users with a wireless power alternative presently
unavailable in competing products.
Every Semper Five external battery accessory will be designed for on the go use and
ease of operation, employing the 30-pin (iPhone 4/4s) and Lightning (iPhone 5/5c/5s/6) formats
for Apple products and the Micro USB charging format favored by smartphones utilizing the
Android operating systems. This product’s packaging will be retail friendly, as these devices are
designed for sale everywhere batteries are sold, from boulevard bodegas to high-end malls and
boutiques.
25
Business Plan for a Consumer Electronics Accessories Company
Semper Five’s self-contained smartphone power products provide an opportunity to
employ the global use and popularity of telecommunications technology to create a new market
opportunity. The MyRun and Marathon Series charging devices will represent the first step in the
evolution of a world that is truly “wireless” and unfettered by wires, cables and recharging
downtime. Each Semper Five product is as easy to use as plugging a smartphone into a docking
station, only without the need for a cable.
The MyRun and Marathon product lines provide this enterprise with the potential to
influence the smartphone consumers’ electronics market as a disruptive entity, dramatically
altering present usage patterns. As truly wireless power products, each will allow the business
traveler, outdoor enthusiast and teenager the opportunity to remain connected, informed and
entertained - anywhere, anytime and under any contingency - without the need for their device,
and the smartphone user, to be tethered to a hardwired electrical outlet, electronic host, USB
cable or power adapter. Aesthetically designed to be lightweight and easy to use, coupled with an
extended shelf-life, Semper Five products will be suitable for every mobile handset user, and will
become a valuable accessory for every emergency, easily stored in every knapsack, purse, and
briefcase or jacket pocket. The Semper Five, Incorporated product line will meet the power and
utility requirements of every Smartphone consumer - Globally.
Pricing
Semper Five realizes global economies and consumer income influence the success and
failure rate of every enterprise. Semper Five intent is to make its product line available to every
mobile user and within their budgets as well. The MyRun and MyTaxi products will retail for
$24.99 and 12.99 respectively, while The Marathon and Marathon2 products will retail for
$49.99 and $69.99 respectively. This pricing strategy will ensure this enterprise is profitable, yet
26
Business Plan for a Consumer Electronics Accessories Company
competitive in its market segment. Further, it provides opportunity to adjust the products pricing
in the advent of imitating products entering the market segment as well.
Sales Strategy
As previously noted, the CE smartphone external battery case market segment is
extremely competitive, and subject to a continuous flow of new competitors. This is due to the
ease of entry into both this market and segment. Being a new enterprise, the need to minimize
expense and marshal fiscal resources, yet remain competitive is paramount to success. To
accomplish these necessary actions, Semper Five will enter the CE smartphone external battery
case market segment with the Marathon as it banner carrier. With power capacity being at the
forefront of the smartphone consumers’ operational dilemma, it answers the issue profoundly
and definitively. The Marathon’s combination of attractive protective case, coupled with its
power capacity, simplicity of operation and on-demand power feature, creates an intuitive and
aesthetically pleasing user experience. The Marathon2 and MyRun products, while equally
appealing, will be released later in the life of this enterprise, with strategic launches and product
placement enhancing their market segment position.
27
Business Plan for a Consumer Electronics Accessories Company
Market Analysis
Overview
As the worldwide wireless communication network readies for impending worldwide
mobile subscription saturation, the need to maintain portability and operational longevity will
grow as well. As the current trend of mobile telephones replacing the traditional home telephone,
and the emerging trend of the smart phone acting as desktop computer and game console
replacement continue to gain momentum, the need to power these devices in transit will also
amplify. This presumption is solidified with the simple examination of the global mobile
subscriber saturation trend, mobile device supplanting traditional computing for Internet access,
and its adoption into general business practice of both individuals and multi-national enterprises.
The need to power, charge and recharge these electronic devices, particularly smart
phones, tablet/laptop computers and other mobile communication devices, will require high
capacity, low profile external charging accessories capable of sustaining the power requirements
of modern consumer electronic devices. Moreover, the consumer electronics market will
embrace a new mobile communication accessory that meets this demand. As previously detailed,
mobile users most common complaints relate to battery capacity and performance
(TrendsSpotting Trends Research, 2012). The need for wireless power alternatives remains an
essential element of mobile device operation and performance.
28
Business Plan for a Consumer Electronics Accessories Company
Figure 4: Smartphone Battery Capacity versus Heavy User Power Requirements IMS Research, 2009
Since its introduction, the Smartphone has become firmly entrenched as society’s
indispensable electronics device. The ever evolving utility, versatility and connectivity of mobile
technology have transformed the Smartphone from luxury accessory into a daily essential. In
2002, the telecommunications industry reached an incredible and unforeseen milestone. For in
2002, the number of mobile telephone service subscribers surpassed the number of landline
subscribers … worldwide. Present telecommunication industry estimates indicate market
saturation approaching 96% may occur by the close of 2014. This can be equated to virtually
every inhabitant of Earth owning a mobile handset (International Telecommunications Union,
2003). This event marked the beginning of the mobile revolution, transforming the cellular
telephone and its associated technologies, from simple telecommunication service option into an
instrument for economic development and social icon. Even more remarkable, this trend has
occurred without geographical, demographical or socioeconomic limitation.
29
Business Plan for a Consumer Electronics Accessories Company
Figure 5: U.S. Smartphone Penetration by Ethnicity
The Nielsen Company, 2014
As the smartphone continues its evolution into a complex fusion of voice, text, data,
video, Internet connectivity, games/aps and audio technologies, the mobile consumer desire to
always be connected will grow. In 2012, research conducted by Nielsen Mobile Insights revealed
a majority of mobile subscribers in the United States, approximately 50.4%, owned smartphones.
Further, consumers purchasing new mobile handsets were selecting smartphones to replace their
old mobile feature phones. Amongst smartphone owners, the Android Operating System (OS)
handsets are the most popular (48.5% global sales); while the Apple (32% of sales) remains the
sales leader and most desired consumer brand (Nielsen, 2012). In 2014, Nielsen discovered
smartphone ownership in the United States had grown to approximately 68%, with 52% of sales
being for the Android OS and 42% for the Apple IOS (Nielsen, 2014).
30
Business Plan for a Consumer Electronics Accessories Company
Figure 6: Top U.S. Smartphone Operating Systems by Market Share
the Nielsen Company, 2014
It should be noted that despite its apparent 52% market share, the Android OS segment is
divided amongst a number of manufacturers using this operating system, most notably Samsung
and HTC (High-Tech Computer Corporation). The Windows smartphone, which uses a variation
of the Microsoft Windows computer operating system, is gaining popularity, while the
BlackBerry OS and RIM continue to decline.
Smartphone Accessories Market
Smartphone mobile accessories are increasingly becoming tailored to the user's
performance needs, personal style and preferences, all to augment the device owner’s mobile
experience. Among the thirteen accessory product segments tracked by ABI Research, protective
31
Business Plan for a Consumer Electronics Accessories Company
cases are predicted to show the highest growth rates of 18.2%. The design of smarter accessories
enhances the utilization of key smartphone features will enable mobile device accessory
manufacturers to remain competitive. ABI Research expects this push for smarter accessories to
not only drive improved design but further maintain or grow average mobile accessory pricing
across the category (Business Wire, 2012).
Smartphone handset accessories offer smartphone manufacturers, mobile service
providers and related retailers a high profit margin on sales. Every vendor in the smartphone
mobile accessory segment enjoys this benefit, not only at the time of initial smartphone purchase
but when a consumer seeks to update their devices appearance or due to wear and tear. As a
result, mobile handset accessories contribute to the retailers’ sales initiatives and promotions.
Meanwhile, mobile consumers enjoy extended product life and operational convenience for their
smartphones, and view the purchase of smartphone accessories as a means of protecting and
personalizing their smartphone device, as well as for the enhancing their user experience (ABI
Research, 2012).
Presently, mobile industry analysts forecast aftermarket mobile accessory revenues will
reach $62 billion by 2017 as market value moves to smart accessories. According to the latest
analysis from market intelligence firm ABI Research, smartphones generally generate greater
accessory revenues per device, and will drive 80% of the aftermarket mobile accessory revenues
in 2017. This growth will be fueled by the continued consumer adoption of smartphones over
feature phones, causing the market for mobile device accessories to grow at a 10.5% compound
annual growth rate (CAGR) from 2012 through 2017, resulting in annual revenues of $62 billion
by 2017 (Business Wire, 2012).
32
Business Plan for a Consumer Electronics Accessories Company
Smartphone Handsets
The smartphone handset market segment is subject to consumer choice and operating
system preference. As indicated by the previous section of this business plan, Apple’s iPhone is
the standard bearer. Oddly, the iPhone 5/5s/5c has not been as enthusiastically received as
previous new Apple models, yet is gaining momentum. The iPhone 4/4s continues to have sales
momentum, mostly due to its strong performance and lower pricing acting as a gateway to
iPhone ownership. Amongst the manufacturers using the Android OS, Samsung is the sales
leader, with its Galaxy line leading this segment, followed by the HTC, Google, LG, Nokia and
Motorola in hot pursuit for market share. Battery life (runtime) for the PC Magazine Top 10
smartphones averages 10 hours, 13 minutes (14 hours, 47 minutes for the 7 handsets tested), with
a high of 18 hours, 15 minutes for the large screen Samsung Galaxy Note 3 and Apple’s iPhone
5s having the lowest at 9 hours, 59 minutes (PC Magazine, 2014).
Battery Industry
CE external battery accessory segment is propelled by the portability of the technology
and its global integration into professional and personal daily practice. Smart phones and other
portable applications are driving force in the growth in the power supply industry, influencing
everything from management integrated circuits, battery chargers and adapters, to rechargeable
batteries. The market for external power supplies used in applications such as mobile phones,
was forecast to reach nearly 700 million units with a five-year Compounded Annual Growth
Rate (CAGR) of 10.3% in 2004 (Brush, 2009). In 2012, TechNavio Infiniti Research Limited
research indicates the Global Accessories and Peripherals for Smart phones and Tablets Market
is forecast to grow at a CAGR of 23.5 percent over the 5-year period of 2012-2016
(Researchandmarkets.com, 2012). This growth is fueled by the sales of rechargeable battery
33
Business Plan for a Consumer Electronics Accessories Company
packs lithium-ion (Li-Ion), lithium-polymer (Li-P), nickel metal hydride (NiMH) and nickelcadmium, driven primarily by mobile phone technologies (Brush, 2012). These battery formats
are used in a variety of external battery charging products, with battery cases and power banks
for smartphones being the most popular.
While the battery industry has been the focus of this issue, the consumer electronics
industry and manufacturers have been well aware that battery life is the greatest concern for
consumers and are attempting to make their devices more efficient (Cooper, 2001). The
consumers need for the operational longevity of mobile devices has extended beyond the
capacity of the battery itself. Solutions can come from either the battery or mobile device
manufacturing side of the equation. Both the battery and mobile handset manufacturers are
working feverishly to resolve this issue, with each investing substantial design and development
time (and dollars) in resolving the mobile device power dilemma. While the battery industry is
investigating a myriad of battery chemistries and delivery formulas, the handset manufacturers
are investigating mobile device electronic components and operational processes and
applications (apps). The most logical approach is power management in mobile devices through
better electronic components and standardization of power measurement methods relating to
battery life (Brush, 2004).
An example of this philosophy is new app called “Battery+ “designed to maximize
utilization of the user’s Smartphone battery and alleviates the expense of purchasing an external
battery pack. The app’s biggest feature is that it automatically shuts off the Smartphone’s LTE
Long-Term Evolution), Wi-Fi and Bluetooth radios if there are no connections nearby, which
will ensure that the handset won’t waste energy trying to connect to networks that are not within
range (Reed, 2014).
34
Business Plan for a Consumer Electronics Accessories Company
Universal Charging Standard
In addition, the mobile handset manufacturing industry has discussed establishing a
universal charging standard for all new mobile device handsets. The plan is to institute an
international standard that will employ a battery charging adapter based upon the micro-universal
bus (USB) connector. The agreement, which been endorsed by the major mobile handset
manufacturers (Apple, LG, Motorola, Nokia, RIM (Research In Motion), Samsung and Sony
Ericsson), would place a USB charging port on all mobile handsets with a similarly equipped
charging device included at the time of sale. Effective since January 2010, this practice was
initially implemented in Europe; the new standard was quickly implemented for most of the
handsets directed for the North American cellular market (Bertolucci, 2009).
However, while the new USB standard was implemented by the majority of mobile
handset manufacturers, Apple has yet to comply. Its iPhone 4/4s and iPhone 5 manufactured
after the standard’s 2010 effective date, use charging ports that 30-pin and Lightning charging
ports respectively (Apple.com, 2014). As a result, global adoption and implementation of a
universal charging standard has not been formally established. Nevertheless, the smartphone
charging options have been firmly established, with three charging at the forefront. This occurred
due to the aforementioned events, with smartphone handset operational format (IOS/Lightning
versus Android/Micro-usb) being the determining factor. The 30-pin charging port will remain
popular due to the iPhone 4/4s handsets popularity and operational capabilities as a lower cost
alternative to newer and costlier smartphone handsets.
“Wireless” Charging
Charging the internal battery of any electronic device without the use of cables and/or
cords constitutes wireless charging. The concept of wireless charging is not really new; it has
35
Business Plan for a Consumer Electronics Accessories Company
been round for some time. The model was first introduced by Nikola Tesla in 1899 when he
demonstrated the transmission of 100 million volts of electricity across 26 miles. Since 2011, this
“old” technology has been reintroduced as a battery charging medium for mobile consumer
electronics devices, especially for smartphones. (marketsandmarkets.com, 2012). There are two
primary types of wireless charging: inductive and conductive.
Inductive chargers utilize an electrical current passing through a coil to create an
electromagnetic field to transfer energy to the depleted battery. A corresponding coil usually
contained in a rubber sleeve or cover is fitted over the depleted mobile device, which converts
the electromagnetic field back into electrical current and charges the battery (Russell, 2014).
Inductive charging, also known as Near Field Communication (NFC), operates on the same basis
as radio waves. Being that it can cover a larger area than inductive charging, this charging
method can be added to existing furnishings and locations without adaptation. This will allow
NFC to charge a number of devices place upon a large conference room table, provided adequate
power transmission has been established. Inductive chargers have gained greater support from
device manufacturers, with handset manufacturers like Samsung, LG, RIM, and Motorola
incorporating the technology as a standard feature into future mobile devices
(marketsandmarkets.com, 2012).
Conductive charging, on the other hand, works with direct electrical contact between the
power-source and the battery. Conductive charging stations are a about the size of traditional
desktop mouse pads, covered with conductive panels that connect with the conductive materials
positioned in a rubberized smartphone sleeve/cover as used by inductive chargers. Once placed
in the sleeve, the depleted mobile device is simply placed on the conductive charging station
monitor side facing the ceiling. The downside to conductive charging is that you can't build the
36
Business Plan for a Consumer Electronics Accessories Company
panels into other materials, like desks or airline tray-tables like inductive charging, and the
conductive charging station size limits its use to 2-4 mobile devices. In either wireless option, the
user must have conductive format compatibility built into their device, or secure the appropriate
charging station and charging sleeve/cover.
Wireless charging, whether inductive or conductive, affords the mobile device user the
opportunity to replenish their battery by simply placing it upon a table or charging station/mat
for charging. This would alleviate the need for cables and power adapters, or even plugging the
device in at all.
While a few smartphone platforms and manufacturers produce mobile devices with a
wireless charging capability, the technology has been waiting on the threshold of wider adoption.
The lack of a single standard has inhibited widespread use, though three standards organizations
are vying for acceptance: the Alliance of Wireless Power (A4WP), the Power Matters Alliance
(PMA), and the Wireless Power Consortium (WPC). The Institute of Electrical and Electronics
Engineers (IEEE), the world’s largest professional association for the advancement of
technology, is also involved with its Wireless Power and Charging Systems Working Group
(WPCS-WG) and hopes to move toward establishing a single industry standard if possible,
However, several electronics manufacturers have started working with a standard called Qi
(pronounced "chee"), including LG Electronics, Motorola, Nokia, HTC, Sony and Samsung, and
it appears likely to adopt this format as the industry wireless charging standard (Frenzel, 2014).
Customers
The Consumer Electronics Association (CEA), the technology trade association
representing the $208 billion U.S. consumer electronics (CE) industry, conducted research that
reports 59 percent of online participants surveyed purchased CE accessories in the last year.
37
Business Plan for a Consumer Electronics Accessories Company
Amongst the most popular items consumers purchased by online consumers were wireless phone
chargers (41 percent) and wireless phone cases (32 percent) (Consumer Electronics Association,
2014). The CE accessories market presents mobile service providers and CE retailers with a high
margin, quick-return revenue stream. Mobile device accessories are profit drivers, creating addon sales revenue from the core product purchased by the same customer. For the mobile
customer, CE accessories represent an opportunity to validate the core product’s purpose of
purchase (Marrison, 2004). Competition and price deflation continue to be a significant factor
affecting both product manufacturers and retailers sales margins, though accessories are the
principal means of augmenting gross margins for retailers (TWICE, 2009).
($ mil.)








Cell phone device protection
Cell phone chargers
Cellular headsets
Cellphone screen protection
Cellular hands free
Cellphone batteries
Cellphone holders/stands
Other cellphone accessories
613.00
213.60
202.40
145.30
37.10
23.20
11.00
52.80
Share %
47.21
16.45
15.50
11.19
2.86
1.79
0.85
4.07
*Sales are shown in millions of dollars from the second quarter of 2011 through the first quarter of 2012.
Figure 7: Top Categories of Cell Phone Accessories 2011-2012 NPD Group Inc./Market Share Reporter, 2012
As the Smartphone and mobile technology evolved into a high-powered, multifaceted
apparatus, so did the mobile users performance expectations. Consumers place increasingly
complex demands on the functionality of their devices. Smartphone handset satisfaction has
become conjoined with battery performance, becoming a critical factor in overall satisfaction as
well as brand loyalty, according to a J.D. Power and Associates study. Smartphone user
satisfaction, and device functionality, is greatly impacted by battery longevity before recharging
is required. In addition, the study finds that satisfaction with battery performance is by far the
least satisfying aspect of Smartphone use and ownership, and satisfaction in this area is one of
38
Business Plan for a Consumer Electronics Accessories Company
only a few attributes that has steadily declined despite the device’s significant evolution.
Satisfaction levels with battery performance differ widely between owners of 3G- and 4Genabled Smartphone and tablet devices (2012).
Among owners of 4G-enabled Smart phones and PDAs, battery performance satisfaction
ratings average approximately 6.1 on a 10-point scale. Yet, battery satisfaction ratings amongst
owners of 3G Smart phones (6.7) are only slightly higher. This difference possibly stems from
the fact that newer 4G Smart phones use substantial battery life searching for next-generation
network signals, which tend to be widely available than 3G signals. In addition, owners of 4Genabled Smart phones tend to use their device more extensively, than Smartphone owners with
3G Smart phones or traditional handsets. This practice of the 4G user puts a significantly higher
demand on the battery (cellular-news.com, 2012).
The consumer simply wants more power and extended operational service from their
smartphones and other mobile devices. In a 2012 survey of 7,080 smartphone owners, research
conducted by J.D. Power and Associates found that, while most users were happy with their
mobile devices, battery life was named as "one of the few attributes that have declined greatly
from previous years." Smartphone manufacturers have dramatically increased the smartphones'
capabilities; the device’s lack of run-time limits their functionality.
Yet in the quest for more power, globally consumers have shown a willingness to invest
in power extenders, with wireless phone chargers, external battery smartphone cases and power
banks leading sales dominance. The CE accessories market has responded with a plethora of
these external battery devices, powered by everything from AAA batteries to solar power. The
customers craving for extended battery life and handset operation has transformed mobile device
external battery accessories into profit drivers, creating sales revenue from the initial smartphone
39
Business Plan for a Consumer Electronics Accessories Company
purchase (Marrison, 2004). Yet each represents only a respite from the power issue, not a
projected solution.
Smartphone and mobile device operational longevity is dependent upon its internal
battery. A smartphone battery, much like a car battery, will drain while it is being used.
Smartphone user patterns and practices increase the rate at which mobile device batteries drain.
Unless the mobile handset is shut off completely, the battery drain is always occurring to some
degree, due to parasitic background features and processes continued operation. Once the
smartphone battery is completely drained, the handset becomes useless until it is charged again
(Shankel, 2014). This course of events is an operational given for mobile handset users, usually
in concert with Murphy’s Law – If something will go wrong, it will - at the most inappropriate time.
Competing Products
Presently, the number of competitors in the “external mobile device battery charger”
industry is great. To date, the market is presently dictated by product offerings which rely upon
traditional double A (AA) and triple A (AAA) alkaline and lithium based batteries as power
sources. In each instance, the battery operated device is attached to the mobile device via cable,
minimizing mobility and/or utility of the Smartphone or mobile device.
The next class of external mobile device charger is representative of a case-like device
which houses a high-capacity lithium battery. This class, which has a spotty history of
performance, offers the greatest competition to Semper Five products. However, like the
previously described battery operated chargers, these devices also require an external power
source to store current. As a result, this class of device is not self-contained, and requires the
equivalent of a charged electrical device or host, in order to store power and function.
In addition, every competing device in this segment requires an external power source –
40
Business Plan for a Consumer Electronics Accessories Company
an electrical outlet, fully charged USB enable host device or NFC enabled apparatus – to
function as a power adder. In this regard, each is limited by its need for an external power source
to perform it intended function. Even the current generation of solar powered devices is
dependent upon access to a window (direct sunlight) and a strong flow of direct light for
operation. This class of device also has limited power capacity, offering the user the option of
only partial recharging of their mobile device.
Following the examination and inspection of the product offerings of electronic
accessory manufacturers from a variety of Internet-based retailers (i.e. TigerDirect.com), brickand-mortar electronics retailers (i.e. Best Buy, Staples, Micro Center), and mobile service
providers (Verizon, AT&T, T-Mobile), it has been determined that no manufacturer is presently
offering a product that is self-contained and stand-alone mobile device recharging unit. In short,
there are similar and related product offerings in a highly competitive market and industry,
where imitation and duplication occurs in lieu of innovation.
However, in such an environment Semper Five has its innovative and patent-pending
design, which will differentiate its products from competitors. This venture also enjoys the
benefit of being the industry innovator and initiator, which coupled with a strong advertisement
and product line extending beyond just Smart phones, should allow the company to maintain its
position as industry and price leader.
The battery manufacturing and related CE industries are attempting to resolve the
smartphone power issue on a variety of fronts. The battery manufacturers are vigorously
attempting to build better batteries, experimenting with new formats and battery chemistries. The
CE industry and mobile device manufacturers are doing the same, prioritizing the design and
development of electronic components and processes to enhance battery and mobile device
41
Business Plan for a Consumer Electronics Accessories Company
efficiency. Retailers attempt to offer its customers relief by presenting power saving operational
suggestions and tips, in addition to marketing a collection of external battery accessories. This
has led to CE external battery accessories becoming a principal means of augmenting gross
margins for retailers (TWICE, 2009).
The smartphone’s power issue may reside in the fact that the battery manufacturing and
CE manufacturers have relied upon the consumers’ recharging of batteries, in lieu of designing
the next wave of mobile device batteries by subscribing to “Moore’s Law.” Moore’s Law
hypothesizes that computing power will double every two years. Current battery technology and
design depends on chemistry that has already been optimized. Smartphone performance
improvements are largely the result of handset manufacturer power-saving techniques in the
processors and operating systems that power mobile devices, not innovations and/or
improvements in the battery itself (Raftery, 2012).
Conclusion
Smartphone and mobile device battery life is the Achilles’ heel of the CE industry. As
smartphone design continues to evolve, these mobile devices will only get faster processors,
higher-resolution display and video media capabilities, and introduce more useful and powerful
software and applications. In their current form, smartphone computing power is greater than the
computer hardware NASA used to send a man to the moon (Raftery, 2012).
Each of the aforementioned smartphone battery charging solutions is subject to current
battery chemistry that with improvements, not change, may take some time to realize. Pending
the arrival of a new battery product, the current smartphone power sources are rechargeable
batteries using lithium-ion (Li-Ion), lithium-polymer (Li-P), nickel metal hydride (NiMH) and
nickel-cadmium, utilize formulas that are all subject to the “Law of Diminishing Returns.” The
42
Business Plan for a Consumer Electronics Accessories Company
Law of Diminishing Returns states that people will get less and less extra output when they add
additional measured quantities of an input while holding other inputs fixed (Olesky, 2012).
In this instance, the “diminishing” theory has application in the aforementioned battery
formats used by mobile handset manufacturers and the external battery industry. As every
smartphone user is aware, not only do their batteries lose power, but occasionally they have to be
replaced. Over time, every battery degrades and eventually stops working, for a variety of
reasons such as issues related to declining capacity, increasing internal resistance, elevated selfdischarge, and premature voltage cut-off on discharge. Each of these problems, separately or in
combination contribute to battery degradation and power loss (Hagopian, 2006).
At this writing, wireless charging using the inductive or conductive power transmission
models appear to be the next “great” charging option for smartphones and other mobile devices.
Presently, a number of handset manufacturers are already integrating this technology into their
newest lines of devices. However, like the rechargeable batteries, power adapters, cords and
cables these technologies may well replace, both inductive and conductive charging are
operationally dependent upon an outside, primary power source to function. In the event of a
power outage, the consumers’ power problem persists.
In this arena, comprised of the Battery Manufacturing Industry, CE Manufacturing
Industry, CE Accessories Market and its External Battery Charger segment, competition is
fierce, with each industry and market vying for being the first to design a workable solution.
Battery life is the final hurdle to the mobile, digital and wireless future smartphone and mobile
device owners envision. Whoever can solve the battery problem first will see "enormous
financial gains" (Raftery, 2012). Semper Five is confident its product line and design model is
poised to fulfill this prediction.
43
Business Plan for a Consumer Electronics Accessories Company
Economics of the Business
Semper Five is committed to the success, profitability and longevity of this
entrepreneurial venture. This section of this business plan will detail the anticipated expenses
related to the initiation of this enterprise. Contained herein are the estimated costs and fees
relating to start-up costs, fixed costs, and revenue required for production, break-even analysis
and the company’s earnings forecasts.
Start-up
Start-up costs are the first step in the establishment of this enterprise, and are critical to
its longevity. These initial expenses will create the foundation for future Semper Five Business
practices. Semper Five expects to incur business initiation costs (start-up costs) of approximately
$85,000.00. The following table delineates each of the anticipated costs of start-up.
Table I: Start-up Expenses
Legal fees (LLC/Patent/Trademark)
Industrial Design
Website
Computers/Software
Travel/Lodging
Total Start-up Costs
$40,000.00
$30,000.00
$3,000.00
$2,000.00
$10,000.00
$85,000.00
At the onset of this endeavor, Semper Five will be operating as a lean enterprise, and will
be self-financed. This will insure the enterprise is operationally and fiscally autonomous. These
will allow Semper Five to firmly establish its business culture, and maintain control of the design
and development of its product lines. However, the company recognizes the need to rescale the
enterprise, as it grow and matures within the CE smartphone accessories market. At that
juncture, the company is prepared to investigate and pursue outside financing and opportunities
offering the greatest return of investment (ROI).
44
Business Plan for a Consumer Electronics Accessories Company
Fixed Costs
The fixed costs listed in following Table 2 denote those annual business costs or expenses
incurred by Semper Five that will not fluctuate or change within reasonable operational
productivity cycles (Accountingcoach.com, 2013). These costs are not generally subject to
variation, and will be consistent regardless of the company’s sale revenue.
Table II: Fixed Costs
Year 1
Monthly
Year 2
Monthly
Year 3
Monthly
$0.00
$0.00 $18,500.00 $1,541.67 $25,000.00 $2,083.33
$12.00
$1.00
$12.00
$1.00 $20,000.00 $1,666.67
$6,300.00
$525.00
$6,300.00
$525.00
$7,500.00
$625.00
$4,500.00
$375.00
$5,000.00
$416,67
$7,500.00
$625.00
$0.00
$0.00
$0.00
$0.00 $250,000.00 $20,833.33
$30,000.00 $2,500.00 $75,000.00 $6,250.00 $125,000.00 $10,416.67
$25,000.00 $2,083.33 $65,000.00 $5,416.67 $100,000.00 $8,333.33
$3,000.00
$250.00
$3,000.00
$250.00 $15,000.00 $1,250.00
$1,500.00
$125.00
$2,500.00
$208.33
$4,000.00
$333.33
$900.00
$75.00
$900.00
$75.00
$1,500.00
$125.00
$5,500.00
$458.33
$5,500.00
$458.33
$7,500.00
$625.00
$12,500.00 $1,041.67
$0.00
$0.00 $35,000.00 $2,916.67
Total
$89,212.00 $7,434.33 $181,712.00 $15,242.67 $598,000.00 $49,833.33
Note: Year 3 increase in Fixed Costs is due to this being the first year salaries are being paid.
Product R&D
Rent
Utilities
Accountant
Salary/Benefits
Marketing
Travel/Lodging
IT Services
Office Supplies
Security
Insurance/Licenses
Tooling/Manufacture
Variable Costs
The variable costs represent those annual business costs or expenses incurred by
Semper Five that will be subject to fluctuation or change subject to operational productivity
cycles (Accountingcoach.com, 2013). These variable costs will fluctuate as output increases and
decreases influenced by price variations due to increased labor and materials costs for example
(Froeb & McCann, 2010). In addition, these expenses are also subject to price and service
discounting due to sales and production volume. In the case of the components, such as the coin
cell batteries which are the power source for Semper Five products, volume purchases can
represent a 25%-55% reduction in the pricing for these essential items (cheap-batteries.com, 2014).
45
Business Plan for a Consumer Electronics Accessories Company
However, in the case of shipping and insurance, increased volume has the opposite effect,
resulting in increases in related company expenditures.
Table 3 denotes the variable costs associated with the production of a single Marathon
unit, in addition to the current production costs in volume. It should be noted that each of these
production costs is assembled with retail pricing, with greater fiscal benefits and cost reduction
occurring with supply chain contracts and scaled purchasing agreements.
Table III: Variable Costs
Variable Costs – Marathon
Components
Batteries
Case/Packaging
Shipping and
Insurance
Total Unit Cost
Unit Cost
(1 Unit)
$6.00
$1.15
Unit Cost
(per 5000 Units)
$4.48
$1.10
Unit Cost
(per 15,000
Units)
$3.90
$1.00
Unit Cost
(per 25,000
Units)
$3.04
$0.95
$0.60
$0.99
$1.29
$1.59
$7.75
$6.57
$6.19
$5.58
Break-Even Analysis
Semper Five’s Break-Even Analysis determines whether a certain volume of output will
result in a profit or loss. The point at which breaking even occurs is at the point in the life of the
enterprise where total revenues equal total costs. In short, an operational break-even point
represents the level of sales necessary to cover all operating costs. At this point, Semper Five’s
earnings before interest and taxes (EBIT) will equal zero ($0.00) (Gitman & Zutter, 2010).
Semper Five’s revenue will be derived from the sales of the MyRun smartphone charging device
at the onset, with initial marketing directed at the North American consumer segment. Due to the
unique properties of Semper Five’s MyRun and the smartphone user’s need to recharge their
device in unusual circumstance and locations, this device offers the greatest branding
46
Business Plan for a Consumer Electronics Accessories Company
opportunity. The Half Marathon and Marathon smartphone external battery charging devices,
which are also unique and share the same power platform as MyRun, do not provide this
promotional advantage. These Semper Five products share physical characteristics familiar to
other products in the external battery case accessory segment, eliminating the advantage of
marked product differentiation. However, each of the e-commerce websites will carry product
descriptions and production preparations made for future product release.
Table 4 contains Semper Five’s projections for the number of total units required to be
sold in order to meet its break-even point objective. The most efficient means of calculating a
firm’s break-even point is to conduct a Break-Even Analysis.
Q = FC/P-VC (Gitman & Zutter, 2010)
The breakdown for this formula is as follows:
P = Price per unit/Product
Q = Number of Units sold
FC = Fixed Costs
VC = Variable Costs/Product
Table IV: Break-Even Analysis
Products
Price (P)
Variable
Cost (VC)
P-VC
# Units
Sold/BreakEven
Marathon
$49.99
$7.57
$42.42
2,104
*Note: Variable Cost (VC) expense was calculated with the inclusion of the $1.00 consumer
sales incentive associated with recycled/expended device.
Following analysis, it is anticipated that Semper Five will achieve break-even within the
first 3.5 months of operation in the Most Likely sales scenario. In contrast, break-even in the
Worst Scenario is projected within approximately 6.1 months of operation, while the Best Case
Scenario will produce break-even within the first month of sales.
47
Business Plan for a Consumer Electronics Accessories Company
Market Performance Projections
In even the best of times, launching a new product – let alone a new brand – is a difficult
undertaking. The SymphonyIRI Pacesetters Report, a marketing industry primer for new
product launches, indicates few new products (less than 2%) introduced to the consumer market
have phenomenal success. However, research indicates 1.5% of consumer made up 80% of sales
for the average new consumer product launched (Catalina Marketing Corporation, 2014).
Semper Five will attempt to reach this audience, seeking to secure 1.5% of the 7 billion global
mobile service subscribers. In the North American market segment, comprised of approximately
375.2 million mobile subscribers in the United States and Canada, this translates into about
5.628 million Semper Five customers.
However, as previously stated, a new brand and product in a crowded market segment
will prove problematic at the onset. The following Semper Five projections, for anticipated
annual and quarterly sales, in addition to Market Sensitivity Analysis, have been documented
with this fact in mind.
Product Sales Projections
Semper Five’s Marathon smartphone external battery charger will lead sales due to its
utility, availability and price point. As a self-contained battery device with a 7-10 year life span,
coupled with the versatility of power on demand, it stands alone amongst competitors whose
products are external power source and wire dependent.
48
Business Plan for a Consumer Electronics Accessories Company
Table V: Anticipated Sales – 3 Year Forecast
Qtr 1
Qtr 2
Qtr3
Qtr 4
Year 1
$24,995.00
$139,972.00
$247,250.54
$264,947.00
Total
$677,164.54
Sales Forecast – Marathon
Year 2
$187,462.50
$209,358.12
$336,682.65
$370,825.82
$1,104,329.09
Year 3
$292,224.54
$416,216.74
$443,261.33
$473,705.24
$1,625,407.85
Market Sensitivity Scenario Analysis
Risk can be defined as the awareness that the actual outcomes of projections, strategies or
forecasts may differ from expectations. Risk is an eternal element of the entrepreneurial process,
yet requires dedicated evaluation and assessment to minimize its effects to optimize venture
profitability. As such, effective risk assessment can significantly affect the valuation of an
enterprise’s investment and performance strategies. While it may be said, “that with great risk
comes greater rewards,” this adage cannot be the basis for business operations. While the
risk/reward paradigm has some virtues, it is through deliberate implementation of fiscal prudence
that the “reward” element of this equation maximizes cash flow, yet minimizes loss. Effective
financial managers must assess risk to avoid the fiscal issues that may derail a venture’s
productivity (Gitman & Zutter, 2012).
Risk, in the fiscal decision context, is associated with the perception of the expected
return for each investment dollar. This perception is directly aligned with the level of
uncertainty or certainty which surrounds the success of a given enterprise, asset, product or
service. The greater the return variation, as it pertains to uncertainty of success, the greater the
expected return. For example, a savings account has a lower risk factor than a new,
entrepreneurial venture. However, while the new venture has a higher expected rate of return,
49
Business Plan for a Consumer Electronics Accessories Company
due to its product or service offering being subject to timing and other market influences, it also
represents an investment with inherent high risk of failure. Yet, for that investor who can tolerate
the potential loss of earnings, the risk is superseded by the value of the new product or service,
or by the forecasted fluctuations in the associated industry or economy. As a result, the risk is
minimized due to the investor’s anticipated return on investment (Gitman & Zutter, 2012).
Market scenario analysis is a tool applied to assess projected risk with a behavioral
approach that uses several possible alternative outcomes to obtain a sense of variability of returns
(Gitman & Zutter, 2012). This technique is often useful for assessing fiscal returns and/or
performance in response to changes in market, consumer or environmental factors.
The following Table 6 contains those select risk scenarios subject to consumer demand and/or
market fluctuation and evolution.
Table VI: Market Sensitivity Scenarios
Products
Marathon
Worst Case Scenario
PriceRetail Revenue
Variable Cost
Monthly
Annual
$17,496.50.50 $209,958.00
$41.24
Semper Five Earnings
Monthly
Annual
$14,434.00
$173,208.00
Totals
$17,496..50
$209,958.00
$14,434.00
Note: Monthly calculations based upon 350 units sold at $49.99 retail pricing
Products
Marathon
Most Likely Case Scenario
Price/Variable
Retail Revenue
Cost
Monthly
Annual
$124,975.00 $1,499,700.00
$41.24
$173,208.00
Semper Five Earnings
Monthly
Annual
$103,100.00 $1,237,200.00
Totals
$124,975.00 $1,499,700.00
$103,100.00
Note: Monthly calculations based upon 2500 units sold at $49.99 retail pricing
$1,237,200.00
50
Business Plan for a Consumer Electronics Accessories Company
Products
Marathon
Best Case Scenario
Price/Variable
Retail Revenue
Cost
Monthly
Annual
$374,925.00 $4,499,100.00
$41.24
Semper Five Earnings
Monthly
Annual
$309,300.00 $3,711,600.00
Totals
$374,925.00 $4,499,100.00
$309,300.00
Note: Monthly calculations based upon 7500 units sold at $49.99 retail pricing
$3,711,600.00
Cash Flow Analysis
This item represents an essential element in the success or hardships of Semper Five as a
business venture. The lack of fiscal resources, or the untimely accumulation of said resources,
can derail the operations of even the most successful enterprises. The attached table indicates the
monthly cash flow, augmented by resources residing in Startup reserve fund at initiation. It is
anticipated that despite being self-financed at the onset, Semper Five will generate enough cash
flow to meet its expenses by the 4th month of operations, and after the unit sales of its Marathon
as indicated in Table 3 (Break-even Point) is achieved.
Table VII: Cash Flow Analysis
Semper Five Cash Flow Analysis – Year 1
Month
Expenses
Cash Flow
Startup Capital
-Startup Expenses
$85,000.00
-5000 Marathon units
$49,850.00
-1
$7,434.33
$8,348.33
2
$7,434.33
$8,348.33
3
$7,434.33
$8,348.33
4
$107,134.33
$46,690.66
5
$7,434.33
$46,690.66
6
$7,434.33
$46,690.66
7
$7,434.33
$82,433.51
8
$7,434.33
$82,433.51
9
$7,434.33
$82,433.51
10
$7,434.33
$88,332.33
11
$107,134.33
$88,332.33
12
$7,434.33
$88,332.33
Surplus/(Deficit)
$255,000.00
$170,000.00
$120,150.00
$121,064.00
$121,978.00
$122,892.00
$62,448.33
$101,704.66
$140,960.99
$215,960.17
$290,959.35
$365,958.53
$446,856.53
$428,054.53
$508,952.53
51
Business Plan for a Consumer Electronics Accessories Company
Month
13
14
15
16
17
18
19
20
21
22
23
24
Semper Five Cash Flow Analysis – Year 2
Expenses
Cash Flow
$15,242.67
$62,487.50
$144,092.67
$62,487.50
$15,242.67
$62,487.50
$15,242.67
$69,786.04
$15,242.67
$69,786.04
$15,242.67
$69,786.04
$15,242.67
$112,227.55
$144,092.67
$112,227.55
$15,242.67
$112,227.55
$15,242.67
$123,625.27
$144,092.67
$123,625.27
$15,242.67
$123,625.27
Surplus/(Deficit)
$556,197.36
$474,592.19
$521,837.02
$576,380.39
$630,923.76
$685,467.13
$782,452.01
$750,586.89
$847,571.77
$955,954.37
$935,486.97
$1,043,869.57
Month
25
26
27
28
29
30
31
32
33
34
35
36
Semper Five Cash Flow Analysis – Year 3
Expenses
Cash Flow
$49,833.33
$97,430.51
$49,833.33
$97,430.51
$49,833.33
$97,430.51
$249,333.33
$138,722.25
$49,833.33
$138,722.25
$49,833.33
$138,722.25
$49,833.33
$147,770.44
$49,833.33
$147,770.44
$49,833.33
$147,770.44
$249,333.33
$157,918.41
$49,833.33
$157,918.41
$49,833.33
$157,918.41
Surplus/(Deficit)
$1,091,466.75
$1,139,063.93
$1,186,661.11
$1,076,050.03
$1,164,938.95
$1,253,827.87
$1,351,764.98
$1,449,702.09
$1,547,639.20
$1,456,224.28
$1,564,309.36
$1,672,394.44
52
Business Plan for a Consumer Electronics Accessories Company
Marketing Plan
Entry into the highly competitive CE external Battery Accessories market segment for
any new and innovative product will prove challenging. Yet the unique attributes and “wireless”
properties of the company’s products, makes the Semper Five Product Line stand alone in a
crowded field. The mobile consumer’s need for uninterrupted mobile device operation and
reliable power delivery will be emphasized and embraced. As a disruptive product in a global
market, this will call for Semper Five to firmly establish its position in the market segment:
Semper Five’s marketing strategy will address the smartphone as a consumer lifestyle
essential. As such, the company direct response is to connect with the mobile users need for
continuous service and media connectivity (data systems, social media and the Internet), as
means of establishing brand awareness and product utility. This will require Semper Five to
emphasize its unique features – truly wireless charging enabling perpetual operation, ease of
operation (plug-and-play), field utility, pricing and the products long shelf life. Semper Five
branding campaign must emphasize the development of a consistent message and dedication to
consumer brand awareness evidenced by exceptional product performance, pricing,
production/product service excellence, through development of a high value and higher impact,
dependable company image which embodies the Semper Five mission and vision.
This marketing strategy will entail the company maximizing every promotional and
public presentation resource, while minimizing incurred promotional expenses. This will ensure
the fiscal longevity of the brand, and still promote products consistent with the mobile
consumers’ power demands, yet emphasizing the attributes of not only the product, but Semper
Five as a business entity. These marketing strategies will embody the value of traditional
practices of print media, press releases, trade shows, select media events and Internet presence.
53
Business Plan for a Consumer Electronics Accessories Company
Yet, as a disruptive new CE external battery accessory/product, Semper Five must also
investigate a means of ensuring its presence in the market is not only known, but embraced by
both mobile technology users, particularly smartphone users at the onset. Semper Five marketing
initiatives must embody promotional value, cost-efficiency and consumer impact to maximize
the company’s Return on Investment (ROI). In short, Semper Five’s marketing must be as
innovative, professional and disruptive as its product line.
Market analysis reveals the smartphone and other mobile devices are no longer utilitarian
workhorses for communication purposes only. In the Age of the Smartphone, these devices are
lifestyle tools and accessories, designed to provide the consumer with access to the world. And
mobile technology has impacted the world – both its citizens and business. The objective of the
Semper Five marketing plan is accomplishment of the same feat.
Market analysis has established worldwide mobile-cellular subscriptions will total
approximately 7 billion by the close of 2014 (International Telecommunications Union, 2014).
However, Semper Five realizes that as a new enterprise, it lacks the expertise and resources
necessary to meet the challenges inherent in global markets and fulfill its obligations to a global
customer base at this juncture. Instead, Semper Five will focus on the North American markets,
directing its attention to first the United States and Canada. These North American markets
comprise 345.2 million and 30.1 million subscriptions respectively, and offer the opportunity of
a consumer base with international makeup due to each containing numerous local and
international travel hubs, and year round tourism and immigration cycles.
The Marketing Plan
Marketing is the process of creating customers, and represents the cornerstone of every
enterprise’s growth and success. The intent of marketing is an ongoing process of not only
54
Business Plan for a Consumer Electronics Accessories Company
attracting new customers, but also creating tactics and strategies for sustaining customer loyalty.
While there is no one given template for this element, and must be continuously redesigned and
adapted to drive future sales and productivity (SBA.gov, 2014).
Semper Five’s marketing strategy is a multi-faceted plan which will approach its entrance
into the CE external battery accessories market segment with strategies augmenting:
-
Market Penetration (Entry)
-
Product Distribution and Sales
-
Customer Interaction and Service
-
Growth and Sustainability
Market Penetration and Entry
The founder of Semper Five recognizes the reality that its global strategy, rapid growth
potential and product branding will require marketing, manufacturing, supply chain, distribution
and fiscal resources to reach this enterprise's objectives. As previously stated, the smartphone
and mobile technology is a global phenomenon. In order to effectively trade upon this market
opportunity will require a disruptive a strategy as the Semper Five product line.
Semper Five will announce its presence in the CE Smartphone External Battery
Accessories Market segment via press releases directed at the United States and Canadian
markets at onset. In addition, Semper Five will also establish its presence within the CE
community by becoming a member in CE industry related associations such as the Consumer
Electronics Association (CEA). Further, the company will announce its entry into the CE
Accessories Market and Smartphone External Battery Case segment by securing booth space and
displaying its product line at the International Consumer Electronics Show, an annual event that
happens in Las Vegas, Nevada. Similar events, such as CE Week in New York, are patronized
55
Business Plan for a Consumer Electronics Accessories Company
not only by consumers but also venture capitalist, angel investors, retail purchasing agents and a
large contingent of international, national and local media affiliates, in addition to CE-specific
journalists.
In short, CE trade shows and new technology related events such as TechCrunch.com
Disrupt Battlefield and Disrupt - New York events provide an exceptional opportunity to
network, contract and publicize the Semper Five brand, in addition to presenting financing and
sales opportunities. The Semper Five presence at these events will also have an effect upon its
Internet sales initiative, establishing its global market presence and buoy product sales and
consumer brand recognition. More importantly, these events are tremendous promotional tools
for the company, yet require minimal promotional expense or marketing expertise.
Semper Five will also establish its brand and extend its CE presence throughout North
America by using the transit hubs and public transportation networks as a vehicle for furthering
its marketing initiative. This will be accomplished by the use of advertising strategically
positioned in or near transit hubs such as domestic and international airports, as well as local and
trans-continental railroads and bus stations. In addition, in each of the major cities in the North
American region, the very buses and trains themselves will offer the company marketing and
advertising vehicles. Further, due to the design and unique properties of smartphone battery
charging products, Semper Five will set-up sales displays in the retail establishments that operate
there. The company will also use billboards situated along busy travel arteries and near bridges
and tunnels to advertise the value and opportunity for perpetual operation.
Semper Five is convinced these marketing vehicle and initiatives will entrench the brand
in the consumers and retailers psyche, and allow this enterprise to grow phenomenally.
56
Business Plan for a Consumer Electronics Accessories Company
Product Distribution and Sales
This element represents the critical element of Semper Five’s entry into the CE external
battery accessories market segment, and initial sales and promotion vehicle. This will necessitate
the creation and maintenance of an Internet presence capable of informing, captivating and
interacting with every customer. In the Age of the Smartphone, Internet marketing and sales are
an integral part of every enterprise’s marketing scheme. Consumer Electronics Association
(CEA) research reports 59 percent of online consumers surveyed purchased CE accessories
online in the last year. The CEA research also investigated online buying behavior, reporting that
the majority of online consumers surveyed (66 percent) say physical stores are the main channel
they use to shop for, learn about and purchase accessories, citing convenience as their primary
motivation. Those consumers who choose to buy accessories online say this option offers the
best prices, convenience and enables easier browsing and comparison shopping (Consumer
Electronics Association, 2014). Semper Five will utilize a number of vehicles in its quest to
establish its brand and retail presence in the CE electronics smartphone accessories market
segment.
At the onset, Semper Five will focus its sales agenda around establishing an Internet
presence and branding signature via the Internet. This will entail the use of many of the most
popular and highly utilized Internet search engines, Google, Google Chrome, Yahoo!, MSN, and
America Online for example, as vehicles to refer consumers searching for “external battery
cases.” In addition, each of the aforementioned Internet search engines has dedicated business
applications and/or business services that are free or low cost. Each of these search engines also
possesses sales, user and customer metrics to accurately assess the impact of your products and
promotions. The company will use these elements, coupled with its dedicated website and
57
Business Plan for a Consumer Electronics Accessories Company
Amazon.com web stores, to effectively create viable e-commerce income and establish its
presence so consumers will be comfortable making secure purchases.
The company will also contact each of the major mobile service providers serving North
America, starting with Verizon Wireless, AT&T Wireless, T-Mobile, Sprint, Virgin Mobile and
Cricket Wireless, to secure sales contracts for Semper Five products via their mobile accessories
sales network (Toptenreviews.com). This will place this enterprise’s products on the front lines
of the smartphone accessories sales arena, and further its consumer brand recognition/branding
initiative. This initiative will also be exercised when Semper Five elects to sell its products in
foreign markets sans Internet web and e-commerce venues.
The company’s presence at the International CE Show in Las Vegas, Nevada will garner
a great deal of media attention and coverage, in addition to being a vehicle for sales contacts and
contracts resulting in Semper Five products developing relationships with brick-and-mortar
(physical) retail establishments. The most desirous of these business relationships will be with
the larger retailers and “box” stores such as Wal-Mart, K-mart, Costco and BJ’s. In addition, the
company will also seek to market its products to the home improvement retailers, such as
Home Depot, Lowe’s and Ace Hardware stores. Each of these retailers represents not only
volume sales, but also have a national retail network and dedicated Internet sales presence.
Distribution of Semper Five products will be conducted via a direct shipping
methodology. The products will be shipped from the overseas manufacturing facility to the
nearest US port in California, New York or New Jersey. From the port-of-call, the products,
packed in lots, will then be directly loaded onto trucks and transported to the retailer.
This practice will minimize Semper Five’s need for warehouse space and staff, and insure
timely delivery to each retail destination.
58
Business Plan for a Consumer Electronics Accessories Company
Internet Sales
This sales vehicle will necessitate the establishment of a web presence not only on
popular social media sites such as Facebook, Twitter and Pinterest, but also include initiating a
company blog, YouTube channel and actively monitoring them. The more popular Internet
search engines, Google, Yahoo! And MSN.com for example, offers the mobile consumer the
opportunity to inspect Semper Five products, and be introduced via a variety of reviews and
detailed descriptions. Further, the e-commerce site, Amazon.com, will be used as a retail sales
generator, tying dedicated external battery shoppers with peer related reviews and detailed
product descriptions. In addition, this sales vehicle, based upon a Morningstar.com (an
independent investment analysis and management firm) estimate indicates Amazon.com had
approximately 10 million at the end of 2012, and 25 million by the close of 2017. Morningstar
also reports Prime members are Amazon's best customers, spending about twice as much as nonPrime members and tend to buy costlier items across a wider range of product categories
(Tsuruoka, 2013). This practice my also extend to local business and entertainment websites
such as Yelp, highlighting those local businesses and national chains that retail the company’s
products regionally.
Moreover, Semper Five will join the legions local and national enterprises utilizing daily
coupon sites such as Groupon and LivingSocial, as a retail and marketing/promotional vehicle.
The value these sites can offer an enterprise in promotional and branding opportunities is
enormous. Groupon, for example is reported to have over 115 million subscribers to its service
alone (Frommer, 2011). Semper Five can connect with a large audience and establish its brand
by offering discount coupons and maintaining a presence within this community of dedicated
Internet shoppers.
59
Business Plan for a Consumer Electronics Accessories Company
The company will also ensure its products are marketed throughout the mobile service
providers’ network, as a means of both brand building as well as sales initiative.
Customer Interaction and Service Data Collection
Each of these marketing vehicles, after initiation investment, represents low cost, nonintrusive sales data collection options for a new enterprise. Each of the aforementioned Internet
sales vehicles also offer Semper Five an opportunity to use the detailed customer relations
management element inherent in each program, reducing the need to invest is such programs at
startup. Dedicated inspection and review of related sales data related to product reviews, product
page reviews, date/time of purchase and customer demographics, will provide Semper Five with
an opportunity to not only interact with customers and address their issues in real time, but also
provide a vehicle for product adaptation, improvement and introduction of new products. This
will allow Semper Five to chronicle not only related sales data, but also be an avenue to
improving self-assessment and brand awareness.
Through the aforementioned websites data collection mechanisms related to each sale,
Semper Five will be better situated to make informed decisions regarding its product line, new
products, customer preferences and trends affecting its longevity and branding. The data
collection technologies will provide Semper Five a low cost, low upfront investment option of
forecasting sales trends, reviewing customer reviews and complaints, and inventory issues in real
time. This will provide the company with an opportunity to meet the needs and resolve issues of
the mobile consumer, retail outlet and supply chain partner with equal grace and speed.
Semper Five Social Responsibility
The public relations element of the Semper Five marketing strategy is also a vehicle for
sharing its corporate culture and business model with the global mobile device user and CE
60
Business Plan for a Consumer Electronics Accessories Company
industry. The use of green incentives/rebates applied to exhausted battery products will be
highlight in each media contact. First, as an element of ensuring the safe and proper disposal
of Semper Five external battery products, in an effort to maintain ecological responsibility by
the product user. But also as a responsibility effort representative of corporate culture.
However, it should also be noted that the rebate/incentive also acts as a vehicle for additional
purchases and customer loyalty. This will require the company to validate customer
smartphone purchases, product sales and accessory acquisition patterns/cycles, in a ddition to
seeding customer retention.
Once Semper Five product line has gained traction within the CE External Battery
Accessories Market segment, the company will engage in a number of community-based and
philanthropic opportunities and events. These may include the donation of products to
natural disaster victims, local sports team sponsorships, educational grant-in-aid or
scholarships and/or faith-related fundraising. In any of these potential opportunities to share,
participate or support, the community will always be the objective. In many of these
situations, Semper Five will be there without the need for cameras or fanfare. Simply being
there and serving our customers will be enough.
Growth and Sustainability
While Semper Five will initiate its entry into the CE External Battery Accessories
market segment via the United States and Canada, the 375.3 million North American mobile
subscribers represents only an entry point (mobi-thinking.com, 2014). As previously stated,
mobile is global. The worldwide mobile subscription saturation forecast of 7 billion mobile
subscribers by the end of 2014 represents an amazing customer base for Semper Five
(International Telecommunications Union, 2014). Every one of those 7 billion mobile
61
Business Plan for a Consumer Electronics Accessories Company
subscribers is representative of a potential customer for Semper Five products. For every
mobile device user will eventually need, not want, to extend the service and operation of
their smartphone or other mobile device.
The company’s Internet website, coupled with its search engine and e-commerce
presence, will insure its products are available to a global audience. Yet, product imitators and
innovators will arise. Such is the case with any successful product launch and disruptive
technology. This may necessitate Semper Five considering the establishment of partnerships and
collaborative relationships with supply chain partners or companies in related industries. For
example, Semper Five may establish a strategic partnership with a battery manufacturer, such as
Duracell. The “Powered by Duracell” proclamation on each Semper Five product will allow the
company to trade on the branding, performance and reputation of a globally recognized leader in
the battery manufacturing industry.
Conclusion
However, as a disruptive product in a crowded global market segment, this will also
call for Semper Five adopting a “veni, vidi, vici” (I came, I saw, I conquered) marketing and
promotional strategy as well (Curwen & Whalley, 2009). This will entail the company using
promotional and sales initiatives as unique and disruptive as its product lines. To establish its
position in the smartphone battery case accessories market segment, Semper Five will separate
itself by offering its products as high value, low cost alternatives to competing products.
The company will retail its products at a price point that is 25%-40% lower than present
segment leaders.
Further, Semper Five will promote its products using advertising media sources, such as
radio, television ads and billboards strategically placed to optimize promotional value. This will
62
Business Plan for a Consumer Electronics Accessories Company
be affected by using promotional ads airing during the late afternoon and evening hours, when
generally most smartphones and mobile devices are approaching internal battery depletion.
Competing products in this segment do not advertise, and this will prove advantageous for
Semper Five branding and consumer awareness.
While Semper Five will strategically place its products in the retail establishments and
vendors abutting travel hubs, the company will also use vending machines to distribute its
products. Strategically placed in airports and larger transcontinental train/bus stations, vending
machines will be both a valuable retail vehicle and promotional tool. The Semper Five recycling
program will be affected through a series of nationally known retailers, which will aid the retail
sales and branding of Semper Five products using consumer vetted retail entities.
63
Business Plan for a Consumer Electronics Accessories Company
Design and Development Plan
In these days of rapid economic and political change and fluctuating dollar values,
every venture, regardless of maturity or market segment, must have contingencies to adapt.
These strategies must include the flexibility and speed requisite of reacting to untimely market
changes and supply chain demands. Enterprises must make artful decisions relating to
innovation, production, and demand for their products or services due to changes in market
condition, whether favorable or unfavorable. One of the greatest challenges for any venture is
to maintain its competitive edge through innovation and consistently forecasting future trends
and challenges. Innovation is not enough to sustain a business (Pralahad & Krishman, 2008).
Innovation
The most successful business entities are capable of converting their vision, objectives
and strategies into realities. However, the Technology Industry has seen a litany of innovative
companies that once dominated an industry or market segment only to fall from grace. Even
Apple has been amongst the fallen tech titans, and one of the few to be resurrected.
The technology landscape is littered with fallen stars that failed to “pivot” – change
direction and move towards a new market objective (Balassanian, 2012). This fall from grace
occurs due to the fact that every great innovation loses traction. This can be attributed to a
number of factors, from imitators and innovators within the industry to consumer “boredom” and
market/product maturation (Nunes & Breene, 2011). In addition to these factors, the growth or
innovation within an enterprise can be stalled by its lack of resources, its creative or business
processes or its vision, culture and/or value system (Hesselbein, Goldsmith & Somerville, 2002).
The need to continuously re-evaluate operational practices and processes can potentially offer
benefits beyond existing performance paradigms.
64
Business Plan for a Consumer Electronics Accessories Company
The process of innovation and re-invention requires the enterprise and its shareholders to
extend its intellectual and operational resources beyond conventional wisdom and comfort zones.
Success is not dependent upon creation of the next great innovation, but upon dedicated
investment in the innovative and intellectual resources existing within the venture. As the nature
of business continues to grow beyond regional and national borders, innovation represents a
physical entity that now directly affects an enterprise’s global market position, profitability and
the world at-large. Such practice also aligns the company business strategy and vision, while
enhancing engagement and capability development (Hesselbein, Goldsmith & Somerville, 2002).
Semper Five does not intend to become a technology casualty due to the company’s
management and personnel lacking the resources necessary to meet the institutional and
operational need to innovate, create and re-invent. In keeping with its startup company culture,
Semper Five intends to extend its reach beyond the CE mobile accessories market. This is a vital
element of this venture’s operational strategy. Semper Five’s brand value cannot be dependent
upon the successful launching of one big product, even a disruptive one. The long-term success
and longevity of this enterprise will rise from tapping into a number of market segments and/or
industries to generate a continuous stream of revenue that keep producing profits annually.
Design
Semper Five investigation into the viability of its design model has been subject to inhouse modeling. While these prototypes have proven the design model viable, each has been
problematic. This has been due to each prototype being subject to overheating, on one occasion,
beyond tactile comfort. However, the prototypes did power the mobile handset to which it was
connected, and did prove functional.
Semper Five to finalize its design models, will contract design and development of its
65
Business Plan for a Consumer Electronics Accessories Company
product line to Pensa, LLC, a New York City based industrial design company that has an
admirable track record for creating successful products and brand strategies. Pensa will be
contracted to design and develop each of the Semper Five products, with an eye towards not only
performance, but aesthetics, durability and cost effective production. In addition, Industrial
Design with a reputable design firm will also prove an effective means of confirming initiation
date of the concept model in the event of patent or intellectual property challenges.
Design and development of Semper Five products will be completed with an eye on
materials and processes that can be easily attained, and with processes that can be just as easily
duplicated. This being necessary in the event consumer demand requires an additional
manufacturing/assembly location. In addition, aesthetics play a large role in the user experience,
requiring materials offering the consumer exemplary performance, durability and safe operation.
Further, this practice will minimize manufacturing and tooling costs, optimizing organizational
profits and consumer price point.
Upon completion of product models suitable for manufacture, the company will enlist the
professional capabilities of legal counsel specializing in patents to conduct the requisite patent
search, application and design drawings. Semper Five has elected to complete patent application
by seeking a non-provisional patent. This decision is founded in the fact that non-provisional
application will establish both filing date and begin the examination process by the United States
Patent Office. A provisional patent application, while also establishing filing date and lower
processing costs, expires automatically after one year. Being that all patent applications are
subject to public announcement, this would make the provisional patent subject to possible
imitation and/or innovation. In an effort to protect their product models, which constitute
intellectual property, Semper Five has elected the non-provisional process for this reason.
66
Business Plan for a Consumer Electronics Accessories Company
Future Design and Development
Semper Five does not intend to become a technology casualty due to the company’s
management and personnel lacking the resources necessary to meet the institutional and
operational need to innovate, create and re-invent. In keeping with its startup company culture,
Semper Five intends to extend its reach beyond the CE mobile accessories market. This is a vital
element of this venture’s operational strategy. Semper Five’s brand value cannot be dependent
upon the successful launching of one big product, even a disruptive one. The long-term success
and longevity of this enterprise will rise from tapping into a number of market segments and/or
industries to generate a continuous stream of revenue that keep producing profits annually.
While Semper Five will enter the CE external battery accessory market segment with
products dedicated to smartphone users, its product design and model translates well to other
mobile devices. As the popularity and capabilities of tablet computing continues to grow, so too
will their users need for extended service life and battery performance. Semper Five is also
investigating the potential for transferring its design and technology model to the automotive
industry, and the application in the design of emergency fuel cells for hybrid/electric vehicles.
Semper Five also sees opportunities in the battery, fuel cell and renewable power design and
manufacturing industries.
Design and Development Expense
As evidenced by the information entered in the financial sections of this business plan,
design and development constitute a large portion of the Semper Five startup and operational
budgets. This is due to the founder electing to use the aforementioned industrial design firm to
produce each of the three Semper Five products, with intention of offering only one at venture
launch. This will provide Semper Five with the option to strategically launch each of the other
67
Business Plan for a Consumer Electronics Accessories Company
products in the instance of consumer demand or market opportunity. This will minimize the lag
between design phases and product development cycles, ensuring the product line remains
current. This process will be completed again during listed three year period depicted herein,
resulting in the design and development of the next wave of Semper Five products.
This philosophy also applies to the company’s legal fees and the patent application
process. The founder’s law enforcement experience has revealed that highly effective legal
services are due to the expertise, intellectual and research resources at the client’s disposal.
In short, you get what you pay for. In regard to the potential for legal challenges founded by the
design elements of Semper Five’s products and intellectual properties, it is better to uncover
possible issues at the onset than resolve them after the fact. The better legal team that specializes
in patent law will have access to the resources and experience necessary to meet this
requirement. Further, incorporation proceedings and filings will also be completed by this legal
service provider at a reduced fee schedule as well.
68
Business Plan for a Consumer Electronics Accessories Company
Manufacturing and Operations Plan
Business operations are those ongoing recurring (cyclic) activities involved in the running
of a business for producing value for the shareholder and supply chain. (LinkedIn, 2013). Just as
the scope of mobile technology has changed the manner in which the world’s citizenry
communicates, lives and plays – so too has the associated technologies affected the manner in
which global economies function and produce. The greatest challenge for any business entity,
following initial startup, is to maintain its competitive edge through innovation, consistent
production performance and meeting future innovation challenges. Successful businesses are
proficient at adapting and/or revising their strategies through regular monitoring and inspection of
business operations (ansci.cornell.edu, 2008).
In an ever evolving marketplace of global proportion, successful enterprises network their
individual and collective business processes, capabilities and products or services to meet
institutional goals and objectives. Through the forging of borderless production, operational,
supply chain and distribution relationships, enterprises can access the necessary resources for
organizational profitability (Pralahad & Krishman, 2008). The utilization of a global business
ecosystem will offer an enterprise the prospect of exposure to business practices and processes that
may prove pivotal in its productivity and longevity. Technology has become the vehicle to
effectively manage the global supply chain network, optimizing lean and efficient operations
management (Schroeder, Goldstein & Rungtusanatham, 2011).
Semper Five realizes that while its innovative design model is unique and disruptive; its
success is subject to the collective efforts of its strategic supply chain partners. This will extend the
company’s reach, introducing production and intellectual resources outside this enterprise’s
capabilities to lower production costs, reduce product liabilities and improve operational efficiency.
69
Business Plan for a Consumer Electronics Accessories Company
Operations
Every team needs a plan, a set of guidelines, which clearly indicate the team’s agenda,
goals and standards to establish direction and provide motivation. Every team also needs a
leader, a floor general to ensure these objectives are effectively met or employed. Operations
represent the foundation of every organization, whether in manufacturing, service or non-profit
industries. As a result, operations management leads the coordination of the production and
distribution process in every business entity. This is accomplished by formulating and
implementing the strategies and practices that determine the success of the goods or services
provided by the business. An effective operations management team needs to have proper
planning, organization, communication and problem-solving skills to realize organizational
performance goals (Miller, 2013). However, effective performance of these tasks requires
operations management to have adequate knowledge of the operations of the business to resolve
any issue occurring in the production and distribution process of their product or service.
Technology integrates the flow of information between various business processes and
transactions within a company’s financial system. This will enable Semper Five to make
improved business decisions by making information from various parts of the business available
to stakeholders throughout the entire operation in real-time. These technologies, such as Material
Requirements Planning (MRP) and Enterprise Resource Planning (ERP) systems, typically cover
all processes from sales order entries, shipping/delivery, product pricing, warehousing and
inventory, procurement, production, invoicing, service, financials, and many others (Raban,
2011). If the MRP system is controlled and designed well, inventory levels can be reduced, by
reducing the amount of work-in-progress (WIP) and undirected inventory. An MRP system
improves customer service by reducing the number of late orders (both supply chain and
70
Business Plan for a Consumer Electronics Accessories Company
consumer), generating higher levels of productivity and helps the company respond to changes in
demand more efficiently (Abdul, 2011). Most importantly, these systems reduce the waste of
resources, both production and fiscal, and allow for the accumulation, review and evaluation of
customer and company information which may influence decision-making and business practice.
Manufacturing
Successful ventures can no longer operate as vertical or silo-oriented mechanisms within
the selective vacuum of designated industries or established practices and processes. The ever
evolving global marketplace demands every enterprise broaden its supply chain methodology
outside traditional comfort zones. To meet this goal, Semper Five will need to adopt strategies,
best practices and processes that empower it through market fluctuation and segment innovation,
in addition to consumer preference. In such a globalized, technology influenced marketplace,
every element of supply chain management – product or service provider, collaborating
suppliers and producers, and consumer buying trends – no longer exists in a static, unwavering
environment. Instead, the venture must view the marketplace as eternally evolving, and amend
its operation to embrace this factor (Prahalad & Krishman, 2008). As a result, every enterprise
must fine-tune its business model to incorporate technological flexibility and supply chain
transparency as standard business practice.
71
Business Plan for a Consumer Electronics Accessories Company
Management Team
The most successful business entities translate their business’ vision, objectives and
strategies from intangible concept into quantitative realities. Semper Five will accomplish this
by instilling the energy, ideology and creative environment of a newly established
entrepreneurial enterprise into its corporate business practice. The adoption of this corporate
culture will be elemental to the productivity and innovation requisite for this venture’s
sustainability and market leadership. This will allow the venture to maintain and foster a
continuous stream of in-house innovation, customer orientation, user-friendly product design
and dedication to product differentiation, aesthetics and operational excellence (Issacson,
2012).
To meet this challenge, requires Semper Five employ management personal who not
only understand this philosophy, but embody it. From the onset, the venture’s leadership must
embrace its startup culture, emphasizing and encouraging the free exchange of ideas and
capabilities. Semper Five will establish a reputation for being a fun place to work, with a
casual dress policy and work setting. However, this enterprise’s leisurely atmosphere will be
founded upon a dedicated “work hard, play hard” way of life and a demanding work
environment.
The right management team is essential for maintaining the performance parameters of a
company that will stand amongst and recruit the best in the technology industry.
The Team
Semper Five is a startup venture designed with a lean approach to its operational
efficiency, an approach which translates to its small, yet highly capable management team.
This team consists of an assembly of seasoned professionals whose capabilities and experience
72
Business Plan for a Consumer Electronics Accessories Company
will complement the venture’s disruptive product line.
The founder and Chief Executive Officer (CEO) of Semper Five is Myron Brown, a
retired law enforcement professional with over 27 years of service, and 21 years of supervisory
experience. During his tenure, the founder has had occasion to initiate, direct and manage the
fiscal, investigative and intellectual resources of agencies at the federal, state and local levels in
high profile matters. Upon retirement, the founder also had the opportunity to leverage his
experience by managing the budget, operations and 75-man staff of a Fortune 500 client.
These experiences, coupled with his tacit knowledge culled from instructors during the
attainment of his Master’s of Business Administration (MBA) degree, enhance the operational
capabilities of this innovative and proven leader.
The Chief Operations Officer (COO) for this enterprise is Ms. Velda Brown, an
experienced business professional with over 26 years of practical experience. Ms. Brown is an
alumnus of the University of Pittsburgh/Joseph M. Katz Graduate School of Business, with her
MBA concentration in Finance. In addition, Ms. Brown is a former employee of Verizon
Wireless, whose 17-year career included managing its Business-to-Business Accounts section,
and retail sales purchasing experience. In addition, this officer also possesses experience with the
business startup process due to her initiating an enterprise involving medical practice office
management and associated processes in suburban Texas.
The remainder of the Management Team will be unpaid consultants whose expertise
and professional experience is valuable. Each has a skill-set essential to the operations and
startup spirit Semper Five embodies. Rudy Rosefort is an Information and Communications
Technology (ICT) professional and Fordham University alumnus with a Bachelor of Science
degree in Computer Science and Masters of Science degree in Information Technology.
73
Business Plan for a Consumer Electronics Accessories Company
Presently employed as an upper manager by the State of New York, his familiarity with ICT
systems and processes, vendor contacts are invaluable.
Mr. Denzel Fearon, is a self-described “computer geek” and has assembled all but one of
the 6 desktops and 4 laptops in his household. Presently a senior supervisor in the Computer
Crimes Section of the Division of New York State Police, Mr. Fearon, holder of Bachelor and
Master degrees in Computer Science from The State University of New York – Stony Brook, is
an experienced veteran of ICT operating systems and their repair/troubleshooting. Mr. Fearon’s
skill-set will enable Semper Five to maintain its lean business model, with plans in place to
reconfigure and repurpose “e-waste” – discarded or unwanted computer desktop and laptop
computers and accessories – into functional website servers, word processors and computers for
Semper Five use. Not only will this practice reduce IT equipment expenditures and expense, but
is also consistent with the company’s conservation and sustainability initiatives.
Mr. Jerome Dillard, a University of Maryland Robert H. Smith School of Business
alumnus with a Marketing concentration, is a valuable asset to Semper Five. Mr. Dillard is the
owner and operator of Park Dodge Chrysler Jeep in Lexington Park, Maryland. Mr. Dillard has
experience with lean business startups and their efficient operation. This is due to his starting his
32-year old venture in this fashion, within two years of completing his graduate degree. He is
well-versed in the marketing and publicizing a new venture and will offer insight and contacts in
the event Semper Five elects to formally incorporate and/or seek outside financing.
74
Business Plan for a Consumer Electronics Accessories Company
Sustainability and Impact
All batteries, rechargeable batteries as well, eventually expend their power capacity in
response to device operational discharging. Every smartphone user knows that over time, battery
power declines and fades. Over time, a smartphone battery’s capacity declines to the point that it has
to be replaced, at both a financial cost to the consumer or, if the expended battery is improperly
disposed of, our environment (Wang, Gu, Zhou, Zu, Connell, Xiao, Perea, Lauhon, Bang, Zhang,
Wang, & Gao. (2014). Semper Five products, while extending the field utility of smartphones and
other mobile devices, are also subject to consumer disposal following exhaustion.
This fact presented the challenge for this enterprise to create a strategy to alleviate the
potential for expended Semper Five battery products being improperly disposed of, potentially
causing ecological damage. While this enterprise has established a practice to minimize its
participation in ecological damage, this is in effect a global market issue (cbsnews.com, 2008). Man,
both as individual and business entity, has poisoned the earth, dating from the Iron Age through the
Industrial Revolution. These accumulated poor conservation practices have resulted in global
warming, the New York’s “Love Canal” catastrophe, and a collection of global ecological and
biological disasters.
Unfortunately, the practice of improper handling of discarded batteries and electronic
components, also known as “e-waste” has far-reaching health and ecological impact. The typical
electronic device contain more than the valuable electronic components and precious metals. Each
device also may contain dangerous elements such as lead, cadmium, mercury, chromium, polyvinyl
chlorides. All of these materials have known biological and toxicological effects that range from
brain damage and kidney disease, and may result in increased instances of birth defects
and/or cancer (cbsnews.com).
75
Business Plan for a Consumer Electronics Accessories Company
Fortunately, the modern consumer who is the first leg of this “e-waste” problem is
also the source of resolution. Resolution originates with the global consumers who donate
their unwanted devices, often waiting hours for the opportunity. Through use of the Internet
and social media, the consumer can not only minimize the damage to the environment, but may
also reduce device costs through the dedicated reuse and redirecting of electronic components.
These practices may also create a social responsibility opportunity for the companies as well.
Being that not all the devices donated are dysfunctional or inoperable, the companies could
assemble and/or repair these unwanted devices and “re-purpose” these for families, school
districts and new entrepreneurial ventures that lack the resources to purchase such devices.
As a global initiative, this practice offers the opportunity to connect the world.
The consumer electronics industry is founded upon its reputation for building better,
faster and more innovative devices. However, electronics industry designs its products by
addressing future desires, not meeting present ecological needs or dilemmas. As a result, the
industry trades upon the human tendency to incorporate new capabilities in the pursuit of speed,
utility and social status. Yet Semper Five believes the obligation of social responsibility and
ethical practice rests with the companies involved in not only the recycling and dismantling
industries, but with the CE manufacturers themselves. In doing so, these ventures have
unknowingly created global ecological and environmental issues.
In keeping with this need for conservation and social responsibility, Semper Five will
initiate a sales program wherein the company will incorporate the option of receiving a $2.00
rebate for each expended device at the time of purchase of each new MyRun or Marathon power
accessory. This sales practice should inspire the Semper Five customer to hold onto their
expended devices, and reduce the ecological damage done by leeching battery devices in
76
Business Plan for a Consumer Electronics Accessories Company
landfills. This practice also provides Semper Five with an additional income stream from the
recycled batteries when the devices are harvested and the materials repurposed. These fiscal
resources will be used to assist others in need as the circumstance or catastrophic events occur
globally.
77
Business Plan for a Consumer Electronics Accessories Company
Overall Schedule
The following table contains the tentative schedule of startup milestones and events
relative to the formal evolution of Semper Five from innovative notion into dedicated enterprise.
While many of the tasks involved are independent of others, a great many are interdependent and
subject to the completion of another to reach a successful conclusion.
Table VIII: Operations Schedule
Scheduled Event
Date
Details
Industrial Design and Development
initiated
October 2014
Pensa, LLC
Incorporation Process
January 2015
Establish Semper Five as business entity in
State of Delaware. Will also establish
venture as Foreign Enterprise doing
business in State of New York and New
Jersey.
Establish bank accounts, fiduciary
protocols and fiscal policies
January 2015
Bethpage Federal Credit Union, Bethpage,
NY.
Investigate and secure necessary
Insurances and Licenses
January 2015
New York State Department of
Environmental Protection, Albany, NY; AllState Insurance Company, Amityville, NY
Attend 2015 International Consumer
Electronics Show, Las Vegas, Nevada
January 2015
Attend and observation operation and
exhibitors set-up; Use as primer for most
effective presentation techniques, practices
and booth locations
Formally retain Accountant and establish
tax payment, audit and filing schedule
February 2015
William Rich, CPA
Establish office space, Purchase
company telephones
February 2015
Poughkeepsie, NY. Also investigate storage
facilities in area for potential stock overflow
Website Design and secure web name
and address
February 2015
Craft site with e-commerce format, secure
web name/address via GoDaddy.com and
advertising via Google, Google Chrome,
America Online, Yahoo, Firefox
Establish e-commerce store presence
February 2015
Amazon.com and eBay.com; establish
e-commerce stores with product
descriptions and website address containing
company history/mission/vision
Establish company email address
February 2015
www.semperfive.com,
www.semper5power.com
78
Business Plan for a Consumer Electronics Accessories Company
Industrial Design and Development
completed, first stage
March 2015
First stage prototypes; first wave field
testing
Industrial Design and Development
completed
April 2015
Functional prototypes and design drawings
completed
Industrial Design and Development
vetted
May 2015
Field testing prototypes completed
successfully
Patent and trademark/copyright Process
initiated
May 2015
Initiation of patent and trademark/copyright
searches and application process.
Patent Process continues
June 2015
Patent/trademark/copyright searches
completed, applications submitted to United
States Patent Office; Designs awarded
“patent pending” status
First Members meeting
June 2015
Discuss product launch strategy and prepare
Semper Five press release
Contact Apple, Incorporated, Samsung
Electronics, High-Tech Computers
Corporation (HTC)
June 2015
Contact regarding factory authorized mobile
handset accessory status and initiated
application process
Factory Authorized Handset Accessory
status secured
June 2015
Contact each mobile handset manufacturers’
authorized product manufacturers and visit
each site
Contact selected manufacturers,
component suppliers and distributors
June 2015
Sign production contracts and initiate
product manufacture; establish shipping and
distribution network
Contact mobile service providers
July 2015
Establish product sales network with
Verizon Wireless, AT&T Wireless,
T-Mobile, and others
Distribute Press Release
October 2015
Formal announcement of commencement of
business; distribute to global and local news
networks, Mobile service providers,
technology and telecommunication blogs
and websites
First shipment of Semper Five Products
(5000 units) received
August 2015
First order of products arrives in United
States: Sample units provided to all mobile
service providers for testing/examination
2016 International Consumer Electronics
Show: Secure booth/display space for
product line
January 2016
Use event as debut and promotional
opportunity; Sell units on hand and make
media/sales contacts
First wave of pre-orders received
January 2016
First product orders received and price
negotiation initiated.
79
Business Plan for a Consumer Electronics Accessories Company
Risks, Potential Obstacles and Assumptions
Successful entrepreneurs and enterprises focus on market-based opportunities rather than
fiscal, physical or intellectual resources. It can be said that entrepreneurial and innovative spirit
is focused on resolving that great market-based problem, becoming obsessed with what is
believed to be the next breakthrough opportunity. This is founded in the fact that entrepreneurs
have a strong tolerance for risk, ambiguity and uncertainty, promoted by their clear vision of
future possibilities risks (Spinelli & Adams, 2012).
However, Semper Five understands enthusiasm and optimism must have boundaries.
This is due to its shareholders, supply chain partners and potential investors who are vested in
this venture’s future success; and many will invest their personal finances and reputations on its
arrival. As a result, successful entrepreneurs, while risk takers, are not gamblers; they take
calculated risks (Spinelli & Adams, 2012). This requires not only a confident and optimistic view
of market potential and future possibilities, but an unbiased examination of the risks, potential
obstacles and assumptions which influence Semper Five’s success.
Risks
Innovator versus Imitators
There is always the potential for another individual or venture to utilize the battery
technology and power format that is the foundation of Semper Five’s product lines. Despite
Semper Five’s intent to repurpose the coin cell battery in its MyRun and Marathon Series
smartphone external battery accessories, this power source is “old” technology. However, as
previously denoted, the Semper Five design models and the coin cell battery technology can be
repurposed to other mobile electronic devices such as tablet and laptop computers. In addition,
the Semper Five design model also translates to use by desktop computers and as an auxiliary or
80
Business Plan for a Consumer Electronics Accessories Company
emergency power source for depleted hybrid and electric vehicles.
In the event Semper Five should find itself in this position, the company is prepared to
continue to build its brand in the CE smartphones external battery segment and redirect its
innovative and intellectual energies in other power market segments.
Critical Material Supply and Demand
The growing popularity of hybrid and electric vehicles (EV) is driving the global demand
for lithium, nickel, cobalt and other critical battery chemistry related raw materials. In a global
effort to meet environmental and conservation initiatives, reduce dependency on dwindling oil
reserves and create sustainable transportation options, the automotive industry has invested in
EV technology. It is estimated that by 2020, EVs will comprise more than 7% of the global
transportation market, with 70% of hybrid and electric vehicles manufactured in 2015 being
powered by lithium-ion based batteries. This factor, coupled with the need for battery chemistry
materials in other industries such as consumer electronics, construction, pharmaceuticals and
glass production, warrants concern regarding the availability of the materials requisite for battery
production (Waste Management World, 2014).
Another factor impacting the future supply of lithium is the fact that almost 70% of the
global lithium deposit resources are concentrated in South America, known as the ABC region.
This lithium region comprises the nations of Argentina, Bolivia and Chile and its neighbors. In
the event of political or environmental issues, there is an inherent risk of limited accessibility to
battery related resources. This will greatly impact not only the availability of battery raw
materials, but also the production and pricing of batteries, electronics and battery chemistry
related raw materials (Waste Management World, 2014).
81
Business Plan for a Consumer Electronics Accessories Company
While the long-term availability of lithium and battery chemistry raw materials is an
operational cause for concern, it should be noted that Semper Five market analysis does not
evidence this as impacting its sustainability. PEST (Political, Economic, Social and
Technological) factor analysis indicates the major lithium producing nations each possesses
stable, centralized and sustainable governments and environmental protection elements that
presently show no weaknesses or political hotbeds. However, Semper Five realizes this does not
preclude the formulation of a trading bloc much like that existing in oil-rich Middle Eastern
nations, and the need to factor this into its pricing strategy.
Further, it should be noted that battery production accounts for only 25% of global
lithium production, but is expected to reach 40% by 2020 with the increased integration of
hybrid and electric vehicles. Presently, there are industry initiatives in place for recycling and
repurposing expended battery materials. In addition, mining and battery industry manufacturers
are establishing inter-governmental and governmental partnerships to avert potential supply
issues (Waste Management World, 2014).
Still, Semper Five will endeavor to seek a number of production and supply options to
maintain the integrity of its supply chain and manufacturing/operations planning.
Potential Obstacles
Patent Validity Challenges
Patent validity challenges pose a critical obstacle to Semper Five’s effort to protect its
intellectual property/assets via the patent process. In fact, once a patent has been granted, it is
still subject to validity challenge by a competitor, individual, special interest group or
organization with a patent of similar scope or for infringement of patent related elements or
components. Patents validity challenges may be launched as indirect challenges (usually initiated
82
Business Plan for a Consumer Electronics Accessories Company
by the patentee’s competitors) during patent infringement court proceedings. Challenges to
patent validity may also be launched as direct challenges through the USPTO or at trial by
anyone with a vested patent, whether the challenger is in production or not (Yiannaka, 2009).
A result of a direct patent validity challenge is that the disputed patent of record can be
revoked, or its scope can be amended. The European Patent Office statistics indicate
approximately 6% of all patents granted are directly challenged within 9 months after being
granted, with 80% of these patents being amended. In the United States, more than 75% of the
patents granted by the U.S. Patent and Trademark Office (USPTO) are directly challenged,
and are either revoked or amended. In the case of indirect patent validity challenges, statistics
indicate court litigations involving the validity of patents have found approximately 45% to be
invalid, while infringement proceedings found almost half were invalidated. Unfortunately, an
even larger percentage of these patent litigations are commenced patent assertion entities
(PAEs), business entities that do not produce, manufacture nor sell anything (Yiannaka,
2009).
PAEs (also known as “patent trolls”) business model entails the acquisition of a large
number of patents, secured from research companies, operating companies and/or individual
inventors. Upon establishing a large and broad cross selection of patents, the PAEs monetizes
those patents by collecting licensing fees or royalties from anyone it finds practicing one of
the patents in its portfolio without a license. The PAE’s income is derived by this
arrangement, due to the fact that it does not produce nor sell anything within the scope of its
patent portfolio. However, the PAE is more likely to initiate a direct patent validity challenge
or infringement legal action than an enterprise that conducts actual product or service research
and development with intent to market or utilize intellectual properties (Wright, 2014).
83
Business Plan for a Consumer Electronics Accessories Company
The PAE business model and practices imply their patent infringement legal actions
and demands for compensation is nothing more than extortion based upon the nuisance value of
a lawsuit (or threat thereof) and the associated expense, if no agreement is reached with the party
practicing the patent. Being that PAEs do not use the patents held in its portfolio for manufacture
or production, it is not susceptible to counter claims or similar challenges (Wright, 2014). This is
particularly troubling to new enterprises such as Semper Five which do not possess the fiscal
resources for a protracted litigation. The PAEs are aware of this dilemma, which may explain the
increase in such patent related infringement court proceedings, with 62% of patent related
litigations being initiated by PAEs (“Patent Trolls”) in 2012 (Sperling, 2013).
Figure 8: Patent Litigation Chart
www.whitehouse.gov, 2013
Semper Five will attempt to offset the impact of patent related validity challenges and
infringement litigation by limiting the breadth and scope of its product patents, and effectively
highlighting the novelty and unique characteristics of its products. The extensiveness of patent
protection has been shown an important factor in determining patent litigation risk. This is
84
Business Plan for a Consumer Electronics Accessories Company
because the greater the breadth (vagueness) of patent protection, the greater likelihood of
direct/indirect validity challenges and validation/infringement court action. In addition, studies
indicate that courts tend to uphold narrow patents and revoke broad ones because the greater the
patent breadth, the harder it is to show novelty and distinctiveness, making it harder to
demonstrate that the patent is valid (Yiannaka, 2009).
Semper Five views this course as an effective strategy given the continuing rise in patent
litigation and given the increasing number of patents that are invalidated after being challenged.
As a potentially disruptive product in the CE smartphone external battery accessory market
segment, effective patent protection is important for Semper Five as an innovative enterprise.
Since the breadth of its patent protection is subject to self-determination, Semper Five can both
defend and define its innovations through the claims made in the patent and trademark
application processes, through patent breadth decisions, whether the patent will be challenged
and the outcome of the challenge (Yiannaka, 2009).
In short, Semper Five’s patent breadth decisions will affect its success in any resulting
patent validity challenges or litigations. Unfortunately, patent protection does not effectively
deter the likelihood of imitators and patent infringement. As previously stated, protracted patent
litigation and court proceedings can be detrimental to a startup venture or fledgling enterprise.
Fiscal resources bettered invested in branding and/or product research and development will be
siphoned into legal fees and patent infringement defense. Additionally, Semper Five will be
prepared to investigate the options of seeking subsidiary or partnership opportunities with an
established battery manufacturing industry entity capable of providing this enterprise with
industry-related intellectual support to further avert this issue.
85
Business Plan for a Consumer Electronics Accessories Company
Assumptions
The mobile consumers’ demand for increased battery and operational longevity is both a
boon and bane for the external battery makers. The problem is that with increased functionality
comes increased power and power management needs (Brush, 2004). Unfortunately, battery
chemistry technology may have been exhausted, and new innovation may only extend battery
life incrementally without full resolution. Still, Semper Five must note that the battery
manufacturing industry is working feverishly to resolve the battery power dilemma, and any
innovation will prove beneficial to the company as well.
The CE mobile accessories industry has sought to meet this need through a number of
charging options and vehicles to meet the global mobile handset users’ cry for more power.
The CE industry has responded to the huge market for mobile battery charging accessories,
offering the consumer an array of plug-in power adapters, external battery cases and power
banks and “wireless” charging stations. Others are gimmicky or unusual, such as solar charging
panels and devices or hand-cranking power adders (Henry, 2013). Each of these devices is an
attempt to answer the mobile users’ paradox of mobile charging, yet each is dependent upon an
auxiliary or external power source.
Mobile subscription saturation is a likely occurrence which will only bolster the need for
Semper Five’s product line. Upon reaching saturation, mobile handset manufacturers will need to
enhance the capabilities, utility and unique features of their mobile handsets, which in turn will
continue to increase the power-drain presently being experienced by the mobile device users. As
the number of mobile consumers needing to recharge daily increases, the number of publically
available and accessible mobile device charging options will surely decrease steadily. This issue
is further compounded by the continued integration of mobile technology and the smartphone in
86
Business Plan for a Consumer Electronics Accessories Company
particular, into global daily business and consumer practices.
The integration of the smartphone into daily practice is broader than simple mobility
issues. In many instances, the smartphone’s utility has led to its replacing the landline as the
primary contact point in many households. Families across America have made the decision to
rely solely upon mobile technology, while many continue to use both landline and mobile as
telecommunication vehicles. A 2011 study conducted by the National Center for Health Statistics
indicates the trend towards American dependence on mobile technology is in part a financial
decision. This may be due to the lower income households eschewing the cost of the landline for
the mobility and utility of the smartphone. The study found that only 21% of higher income
adults solely depended upon mobile phones as their primary telecommunication option, whereas
nearly 40% of poverty level adults relied upon mobile phones (Wilkerson, 2011). Yet consumers
aren’t the only ones adopting mobile technology over the landline.
AT&T and Verizon, the largest landline telephone companies in the United States, are
both seeking to replace traditional telephone lines with wireless alternatives. AT&T has
already publicized its desire to deactivate its landline wire service by the end of this decade.
This phenomenon could mark the beginning of a technological turning point, as copper-wired
landlines are replaced by wireless telephone network technologies. Since peaking in 2000 at 186
million subscribers, 100 million landlines have been disconnected according to US Telecom.
The telecommunication industry group also advises consumer is replacing its copper-wired
landlines with mobile telephone and Internet-based telephone service, with just 25% of United
States households forecast to continue landline service by the end of the decade (Svensson, 2013).
Each of the aforementioned assumptions continue to trend, offering Semper Five a
unique opportunity to flourish. To paraphrase a previous statement, whoever can resolve the
87
Business Plan for a Consumer Electronics Accessories Company
consumer’s mobile battery charging problem first will see "enormous financial gains" (Raftery,
2012). Semper Five is convinced its MyRun and Marathon Series external battery products can
meet this challenge, with this venture being the beneficiary of this prophecy.
88
Business Plan for a Consumer Electronics Accessories Company
Financial Plan
Table IX: Fixed Costs over Three Year Period
FY 2016
Product R&D
FY 2017
FY 2018
$0.00
$18,500.00
$25,000.00
$12.00
$12.00
$20,000.00
Utilities
$6,300.00
$6,300.00
$7,500.00
Accountant
$4,500.00
$5,000.00
$7,500.00
$0.00
$0.00
$250,000.00
Marketing
$30,000.00
$75,000.00
$125,000.00
Travel/Lodging
$25,000.00
$65,000.00
$100,000.00
IT Services
$3,000.00
$3,000.00
$15,000.00
Office Supplies
$1,500.00
$2,500.00
$4,000.00
$900.00
$900.00
$1,500.00
$5,500.00
$5,500.00
$7,500.00
Tooling/Manufacture
$12,500.00
$0.00
$35,000.00
Total
$89,212.00
$181,712.00
$598,000.00
Rent
Salary/Benefits
Security
Insurances
Note: Table 9 delineates the Fixed Costs incurred by Semper Five for the three year period
encompassing fiscal years 2016-2018.
Table X: Salary Breakdown for Three Year Period
Salaried Positions
FY 2016
FY 2017
FY 2018
Chief Executive Officer
$0.00
$0.00
$125,000.00
CFO/Administration
$0.00
$0.00
$50,000.00
CIO/IT Services
$0.00
$0.00
$25,000.00
Product Research & Design
$0.00
$0.00
$25,000.00
Marketing & Sales
$0.00
$0.00
$25,000.00
TOTAL
$0.00
$0.00
$250,000.00
Note: All Executive Officer positions have agreed to not accept salary or compensation for the
initial 2 years of operations. It is anticipated that Semper Five’s gross earnings will meet the
aforementioned $1 million mark in FY 2018, the third year of operation, when salaries will be
paid.
89
Business Plan for a Consumer Electronics Accessories Company
Table XI: Pro Forma Income Statement
FY 2016
FY 2017
FY 2018
$683,414.49
$1,104,379.08
$1,625,524.83
$103,489.47
$158,841.48
$213,961.86
$579,925.02
$945,537.60
$1,411,562.97
Revenue
Gross Sales
Cost/Goods Sold
(COGS)
Gross Profit
Cost of Sales
Beginning Inventory
$49,850.00
$145,760.53
$373,469.05
Plus goods
purchased/manufactured
$199,400.00
$386,550.00
$399,000.00
Total Goods Available
$249,250.00
$532,310.53
$612,961.86
Ending Inventory
$145,760.53
$373,469.05
$399,000.00
$30,000.00
$18,500.00
$25,000.00
$12.00
$12.00
$20,000.00
Utilities
$6,300.00
$6,300.00
$7,500.00
Accountant
$4,500.00
$5,000.00
$7,500.00
$0.00
$0.00
$250,000.00
Marketing
$30,000.00
$75,000.00
$125,000.00
Travel/Lodging
$35,000.00
$65,000.00
$100,000.00
IT Services
$5,000.00
$6,000.00
$15,000.00
Office Supplies
$1,500.00
$2,500.00
$4,000.00
$900.00
$900.00
$1,500.00
Insurances
$5,500.00
$5,500.00
$7,500.00
Legal Fees
$40,000.00
--
--
$12,500.00
--
$35,000.00
Operating Expenses
Product R&D
Rent
Salary/Benefits
Security
Tooling/Manufacture
90
Business Plan for a Consumer Electronics Accessories Company
Total Expenses
$166,212.00
$181,712.00
$598,000.00
Net Profit Before
Taxes
$433,213.02
$763,825.60
$848,562.97
Income Taxes
$173,285.21
$305,530.24
$339,425.19
Net Profit After Taxes
$259,927.81
$458,295.36
$509,137.78
Owner
Draw/Dividends
--
--
--
Adj. to Retained
Earnings
$259,927.81
$458,295.36
$509,137.78
Table XII: Pro Forma Balance Sheet for Three Year Period
2016
ASSETS
2018
2017
Current Assets
Cash
$1,043,869.57
$1,672,394.44
$0
$0
$0
$962,558.64
$2,596,622.78
$3,031,308.51
Temporary Investment
$0
$0
$0
Prepaid Expenses
$0
$0
$0
$1,471,511.17 $3,640,492.35
$4,703,702.95
Net accounts receivable
Inventory
Total Current Assets
$508,952.53
Fixed Assets
Long-term investments
$0
$0
$0
Land
$0
$0
$0
Buildings (net of depreciation)
$0
$0
$0
Plant & equipment (net)
$0
$10,500.00
$8,000.00
Furniture and fixtures (net)
$0
$0
$0
$12,500.00
$0
$27,000.00
Manufacturing/Tooling
91
Business Plan for a Consumer Electronics Accessories Company
$12,500.00
$10,500.00
$35,000.00
$1,484,011.17
$3,650,992.35
$4,738,702.95
Accounts payable
$0
$0
$0
Short-term notes
$0
$0
$0
Current portion of long-term notes
$0
$0
$0
Accruals & other payables
$0
$0
$0
Sales tax payable
$59,798.00
$96,633.17
$142,233.42
Sales commission (8% - Amazon)
$30,070.18
$57,427.71
$97,531.49
$89,868.18
$154,060.88
$239,764.91
Mortgage
$0
$0
$0
Other long-term liabilities
$0
$0
$0
$0
$0
Capital Stock
$0
$0
$0
Retained earnings
$0
$0
$0
$0
$0
$0
$89,868.18
$154,060.88
$239,764.91
Total Net Fixed Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Total Current Liabilities
Long-term liabilities
Total Long-term Liabilities
$0
SHAREHOLDERS’ EQUITY
Total Shareholders’ Liabilities
TOTAL LIABILITIES & EQUITY
92
Business Plan for a Consumer Electronics Accessories Company
Proposed Funding Requirements
Funding Factors
Semper Five will be established as a Limited Liability Company LLC), and will be
self-funded at the venture’s onset. The decision to initiate this enterprise under this LLC legal
structure is due to it offering “some of the best characteristics of corporations, partnerships,
and sole proprietorships” (Kaplan & Warren, 2010). Semper Five will seek LLC status in the
State of Delaware, filing the appropriate Article of Organization and Operating Agreement
documents with the Delaware Secretary of State. Thereafter, Semper Five will be subject to
only an annual status (active/inactive) report and Franchise Fee, as Delaware businesses are
not subject to state or local taxation (revenue.delaware.gov, 2014).
The LLC organizational structure offers Semper Five operational flexibility simplicity,
in addition to the tax and legal benefits inherent to this business model. As an LLC, Semper
Five will enjoy the benefits of debt and liability protection, the ability to classify members
(owners) by voting status and investment, and earnings/losses being reported via members
personal tax filings. This business model also will allow Semper Five to add members as fiscal
or operational needs dictate, whether individual or corporation (Kaplan & Warren, 2010).
This business model will also preserve the founder’s intent to formally establish the previously
described corporate culture, and maintain equity interest prior to being subjected to influences
of future external financing. Still, the LLC business structure could prove problematic due to
this business model being unable to sell shares of stock for funding, and state-by-state legal
restrictions on ownership transfer that can limit venture capital investment opportunities
(Kaplan & Warren, 2010).
93
Business Plan for a Consumer Electronics Accessories Company
Funding Options
As the business climate continues to improve, a financing option available for
Semper Five operation and growth are bank loans. The banking industry has responded to the
improving fiscal climate with offering lower interest rates and less demanding borrowing
requirements. Small business owners are applying for loans at big banks (those institutions with
$10 billion or more in assets) with a 17.8% approval rating as of January 2014. By entering the
small business loan marketplace, the larger banking companies not only benefit the small
business borrower, but the competition is helping to keep interest rates at historical lows.
This has had the trickledown effect where smaller banks (those institutions with assets less than
$10 billion) are presently approving greater than 50% of the small business loan applications
these institutions receive. This may also be resultant of Small Business Administration (SBA)
supported programs directed at small business that offer financing at attractive terms and interest
rates (Arora, 2014).
Even credit unions, which traditionally only execute personal loans and financing
exclusively for its members, is entering the market due to the popularity of SBA Express
program (for loans less than $350,000.00), and SBA 7(a) program (for loans of $350,000 to
$5 million dollars). Each of these borrowing vehicles enhances the options available for
Semper Five to secure the capital necessary for its growth and operational expenses (Arora,
2014). Moreover, Semper Five is also investigating the prospect of banking industry lines of
credit, which will provide a vehicle for liquidity and speed in the event of sudden or unexpected
demand for its product lines.
In preparation for its entry into foreign markets and/or unexpected demand for its
products, Semper Five is investigating alternative financing sources and resources. Much like
94
Business Plan for a Consumer Electronics Accessories Company
MNC investment, angel investors and early-stage venture capitalists may be enticed by this
venture's lean business model and liquidity, electing to invest in the growth and sales potential
outside of North America in return for equity membership. In addition, these same benefits may
also be appealing to a foreign or domestic multi-national corporation (MNC), offering Semper
Five the prospect of foreign direct investment (FDI), and joint venture or merger opportunities as
well.
The present trend of mergers and joint ventures offers small to mid-sized companies
looking beyond their national borders new opportunities within international markets. This trend
is resulting from larger companies with investing accumulated fiscal resources to take advantage
of a growing economy and market opportunities. Presently, this practice has resulted in a
30% increase in business sale pricing over the course of the last three years (Evans, 2014).
These vehicles can provide a firm with new consumer and supply markets and marketing
channels, and provide the fiscal, intellectual and physical resources necessary for cost effective
production and operations (Gitman & Zutter, 2012).
Semper Five is entertaining each of the aforementioned prospective investment tools as a
means of exploiting its business and as a fiscal vehicle for increasing its international footprint
and employing its global business strategy.
Corporate Restructuring
The founder believes the most efficient route to growth of the Semper Five brand, and
increased market penetration lies in a strategic mergers or joint venture with a multi-national
corporation (MNC). This arrangement will benefit Semper Five due to the MNC's operational
capabilities, fiscal resources and supply chain capabilities existing outside of our national
borders, and its familiarity with foreign and domestic business practice. This option represents an
95
Business Plan for a Consumer Electronics Accessories Company
opportunity for this enterprise to become more actively involved in international business
activities, yet do so without traditional startup investment, borrowing or extended fiscal
limitations (Gitman & Zutter, 2012).
As a vehicle for sustainability and growth, this strategy offers this enterprise the prospect
of accelerated growth and rapid expansion into foreign markets. In an eternally evolving business
environment, companies may find that their in-house technology, competencies, innovation or
products and services are not keeping up with industry competition. Alternatively, the company
has the determination to expand its operation into a new market or market segment. In both
instances, mergers and joint ventures allow these enterprises to acquire new or expanded
capabilities, and allow entrance into new business venues. The thrust of this strategy is to
improve this venture’s productivity and value through timely growth, continued product
diversification, asset acquisition, tax considerations, while improving its promotional
competencies and increasing marketing capabilities (Gitman & Zutter, 2012).
This strategy offers this enterprise the opportunity to utilize the intellectual resources,
secure the mechanisms of production, technology, logistics and facilities of an established
business partner for efficient production and unfettered growth. Additionally, to the
aforementioned benefits, this strategy can also act as a catalyst for the acquiring company and
Semper Five to achieve its objectives of sustainable growth.
Unfortunately, these growth vehicles also have a dark side. In the case of mergers, this
action often requires the merging companies to “downsize” reducing the number of employees
and/or holdings to alleviate duplication of effort and as a cost cutting measure. The theory behind
this action is that mergers are initiated with the intent of combining the best components from
each company into a single entity to insure success. Another issue that may arise is constructing
96
Business Plan for a Consumer Electronics Accessories Company
a new corporate culture from two distinct business cultures. The difficulty in achieving this task
is a major reason many mergers fail to achieve expected performance objectives. Joint ventures
also share the aforementioned tribulations. Joint ventures, defined as a contractual agreement
between partners to contribute specific resources or expertise to a mutually and fiscally
beneficial endeavor, can suffer from problems involving allocation of effort, authority and
profits. When these problems are contained, mergers and joint ventures operate smoothly,
combining the specialties of all companies involved toward a mutually beneficial goals and
objectives (Gitman &Zutter, 2012).
Despite these potential operational issues, Semper Five views the potential for merger,
joint venture or subsidiary status as beneficial. Being a lean operation with minimal staffing,
a high liquidity quotient and limited liabilities should minimize the difficulties that may occur as
a result of any of the aforementioned business relationships. Further, each of these options will
enhance this venture's global growth and product diversification strategies. This will be achieved
through the acquiring MNC's brand recognition, market valuation and enhanced fiscal,
technological and intellectual resources, and increased product diversification cycle.
While this growth strategy, coupled with Semper Five's LLC status, may reduce both the
number of potential suitors and restrict the founder's control and input, it is believed this
approach will prove mutually beneficial. To meet the aforementioned organizational and growth
objectives, the founder is prepared to restructure the venture into a corporate model if necessary.
Exit Strategy
As previously noted, Semper Five will be a self-funded enterprise at the onset, requiring
$174,212.00 for business startup and first year operation expenses and initial production and
manufacturing tooling costs, with an additional $49,850.00 for initial merchandise procurement.
97
Business Plan for a Consumer Electronics Accessories Company
The venture will utilize $150 thousand of the founder's savings, and an additional
$105 thousand presented as gifts from family and friends. However, the initiation of the business
startup process, coupled with the implementation of business objectives and strategies will be
costly, and will require this small venture to seek external fiscal resources at some point in its
history. These same circumstances are most obvious with consideration to this venture's intent
to become a global brand, extending sales into foreign markets, and the resultant marketing and
promotional expenses.
As a result of these considerations, the founder is entertaining the option of entering into
a partnership through sale of an equity share in the enterprise, entering a strategic merger with an
MNC, or outright sale of the company. Semper Five and its founder would prefer to initiate the
enterprise's strategic restructuring as a subsidiary to meet its global growth and sales strategy.
This will entail Semper Five locating an acquiring company whose business practices and
corporate culture are in sync with those of this fledgling venture. This is due to the requirement
that the acquiring or holding company have voting control and an ownership interest of 10% to
20% in the acquired subsidiary. In regard to this newly minted startup, it is anticipated that the
MNC will establish a higher standard of 30% to 60% ownership interest. A relationship founded
in the same mission, values and culture will ensure that the capabilities of each entity result in
optimized productivity (Gitman & Zutter, 2012).
While any merger transaction in this instance will be friendly and mutually beneficial,
Semper Five will only entertain those offers which present this venture with long-term strategic
and financial opportunities. To meet this requisite, the acquiring company will need to possess
the technological, fiscal and intellectual capabilities essential for this enterprise's global branding
and sales objectives. In addition to supporting Semper Five design and development initiatives,
98
Business Plan for a Consumer Electronics Accessories Company
proposed product and industry diversification for its design models and global marketing
objectives.
As previously noted, mobile technology and the need for power is a global phenomenon.
Further, the earnings forecasts and sales projections contained within this document are those
calculated for the North American external battery case market exclusively. The earning
potential for this enterprise, from a global perspective, increases dramatically as the trend of
mobile subscription penetration saturation to global saturation. Semper Five will use the
penetration percentages contained in the Ericsson Mobility Report (2014) and the third year
projected North American earnings for Semper Five will be used as its base measurement to
appraise this enterprise at $30 million. Business Brokerage Press publishes an annual guide to
pricing small businesses for sale and identifies manufacturing businesses (those with annual sales
of $1 million to $5 million) at three to four times earnings plus inventory (Taylor, 2010).
In determining fair market value of Semper Five for this undertaking, the founder has
elected to use financial ratios and current global mobile subscription penetration rates for its
calculations. These financial ratio calculations are based upon data contained in the Financial
Plan section of this document utilizing the Most Likely Case Scenario, and represent this
venture's future performance in the North American CE smartphone external battery case market
segment. Yet this assessment also offers a fair and equitable measurement of this enterprise's
earnings potential through examination of its fiscal and market performance on a global scale in
process of determining its final valuation.
The financial statements attached to this document represent a measure of the relative
value of Semper Five as a business entity. As such, it is a fair appraisal of the liquidity (Current
Ratio), activity (Inventory and Total Asset Turnover) and profitability (Gross Profit Margin)
99
Business Plan for a Consumer Electronics Accessories Company
projections for this enterprise. The "acid test" for this section will be Current Ratio analysis
conducted as a means of measuring this venture's liquidity and its ability to meet its short-term
fiscal obligations the formula used for this analysis is:
Current Ratio = Current Assets / Current Liabilities
Using this formula to calculate the current liquidity of this enterprise indicates a Current
Ratio of 19.76, above average for a startup venture. This high degree of liquidity is essential for
this enterprise as it seeks financing and continues to grow and expand. Moreover, this factor also
increases the venture's valuation, as the acquiring company will not assume debt which will
lower the target company's short-term earnings (Gitman & Zutter, 2012).
In addition, Profitability Ratio analysis was conducted and indicates a Gross Profit
Margin of 86.8% in the third year of operation. This analysis, secured using the profitability
formula (Figure 11) which measures the percentage of each sales dollar remaining after the cost
of goods (COGS) (Gitman & Zutter, 2012). While 86.8% is indicative of a desirable low COGS
and a high profit margin, it is anticipated that this figure will improve with increases in
production and sales.
Sales - Cost of Goods Sold / Sales = Gross Profits / Sales
It should be noted that Semper Five revenue forecasts are founded upon the sales of a
single product, the Marathon, in a product line up that will ultimately comprise an additional
related and diversified product offerings in several industries. Moreover, sales projections are
founded upon a lean operation model, utilizing a restrictive marketing budget and media
promotion. These factors have led to the founder to appraise this enterprise at this valuation,
knowing increased promotional investment will increase annual revenue three- to four-fold, and
enhance product and brand valuation.
100
Business Plan for a Consumer Electronics Accessories Company
Summary
From its inception, Semper Five and its line of external battery charging devices, has been
conceived with the simple notion of providing the 6.9 billion global smartphone users opportunity for
uninterrupted functionality. Semper Five products meet the smartphone users need for power,
strengthen the weaknesses inherent to current battery technology and outpace the array of competing
external battery charging products with a truly wireless design model.
The Marathon, and all Semper Five products, represent truly wireless designs that enhance the
utility, function and operational longevity of mobile device technology, offering the mobile consumer
the opportunity for uninterrupted operation. Further, the design model offers easy translation and
adaptation to other mobile device platforms ensuring this venture’s sustainability, longevity and
profitability. The current global mobile subscription saturation (6.9 billion global mobile subscribers)
and integration of mobile technologies into daily global business practice and personal routine, creates
an amazing customer base and fiscal opportunity. The smartphone and mobile device users need to
recharge their devices in exigent circumstance, insures this enterprise’s products will dramatically
modify the wireless charging paradigm. As previously affirmed, Semper Five products line is that next
great disruptive force in mobile technology, the promise of perpetual operation.
Semper Five's global sales strategy, the intent to trade on the 6.9 billion global mobile
subscribers' dream of perpetual smartphone operation, dictates this venture view the world as its
marketplace. This will require Semper Five to saturate the external battery case market segment and
the mobile device consumers' operational consciousness with not only its branding and product lines,
but also their inherent virtues. This campaign must be supported by aggressive global marketing
initiatives and international product placement to exploit this great opportunity. As the impetus of such
disruptive technology, this is an operational essential.
101
Business Plan for a Consumer Electronics Accessories Company
References
Abdul, R. (2011). Benefits of MRP Manufacturing Requirements Planning. Retrieved from
http://www.robabdul.com/benefits_of_mrp_manufacturing_requirements_planning.asp
ABI Research. (2012). Mobile Handset Accessories. ABI Research. Retrieved from
https://www.abiresearch.com/market-research/product/1006272-mobile-handsetaccessories/
Accessories: The Margin Maker. (2009). Twice: This Week in Consumer Electronics, 6-8.
Retrieved from
http://web.b.ebscohost.com.ezproxy.nyack.edu/ehost/pdfviewer/pdfviewer?sid=fd7563f96b0d-4b7d-9461-5496a80e8103%40sessionmgr113&vid=2&hid=112
AccountingCoach.com. (2013). Cheat Sheet. Retrieved from the accuntingcoach.com website at
http://www.accountingcoach.com
Aftermarket mobile accessory revenues to reach $62 billion by 2017 as market value moves to
smart accessories, says ABI research. (2012, Nov 14). Business Wire. Retrieved from
http://ezproxy.nyack.edu/login?url=http://search.proquest.com/docview/1151823531?acc
ountid=38084
Ahead: More wireless replacing landline. (2005, Dec 15). Wireless Week, 11(24). 22.
Retrieved from http://ezproxy.nyack.edu/login?url=http://serch.proquest.com/
docview/195505735?accountid+38084
Amazon.com (2014, May 30). Retrieved from the Amazon.com website on May 30, 2014 at
http://www.amazon.com/
Apple.com. (2014). iPhone 4/4s :Specifications. Retrieved from the Apple.com website at
http://www.apple.com/iphone-4s/specs/
102
Business Plan for a Consumer Electronics Accessories Company
Apple.com. (2014). iPhone 5s :Specifications. Retrieved from the Apple.com website at
http://www.apple.com/iphone-5s/specs/
Arora, R. (2014, February 14). Competition Lowers Interest Rates for Small Business Loans
| Fox Small Business Center. Retrieved July 4, 2014, from
http://smallbusiness.foxbusiness.com/finance-accounting/2014/02/14/competitionlowers-interest-rates-for-small-business-loans/
Bajarin, T. (2012, 07 May). 6 Reasons Apple Is So Successful. TIME.com. Retrieved from
http://techland.time.com/2012/05/07/six-reasons-why-apple-is-successful/
Battery Control Technology: Global Markets. (2012, 30 May). PR Newswire. Retrieved from
http://www.reportlinker.com/p0870789/Battery-Control-Technology-GlobalMarkets.html#utm_source=prnewswire&utm_medium=pr&utm_campaign=Battery
BatteryJunction.com. (2014). Sony CR2477 Lithium Coin Cell Battery. Retrieved from the
Battery Junction.com website at http://www.batteryjunction.com/cr2477.html
BatteryPrice.com. (2014). Lithium Coin Cell Batteries. Retrieved from batteryprice.com at
http://www.batteryprice.com/lithiumcoinbatteries.aspx
Batteryuniversity.com. (2014). Types of Battery Cells. Retrieved from the batteryuniversity.com
website at http://batteryuniversity.com/learn/article/types_of_battery_cells
Becoming a Delaware Corporation. (2014). Retrieved from State of Delaware website at
http://revenue.delaware.gov/services/Business_Tax/Become_DE_Corp.shtml
Bertolucci, J. (2009). Universal Phone Chargers! But Why Stop There? PC World, 27(9), 22.
Retrieved January 09, 2013, from EBSCOhost database.
Bhimrajka, S. K. (2007, Mar 21). Study on Relationship of Competition and Policy Law and
Intellectual Property Rights. Retrieved 09/06/2013 from
103
Business Plan for a Consumer Electronics Accessories Company
http://cci.gov.in/images/media/ResearchReports/sachin_report_20080730103728.pdf
Branscombe, M. (2013, Apr 30). Getting creative with wireless charging for your smartphone.
Retrieved from the ZDNet.com website at http://www.zdnet.com/getting-creative-withwireless-charging-for-your-smartphone-7000014609/
Brush, L. (2004, Aug 05). Market overview: portable: power market on the move. EDN,
49(16), 8+. Retrieved from http://bi.galegroup.com/essentials/article/
GALE%7CA121074856/7df111f65a59e53eed070a9e30eeb6a2?u=nysl_se_nyac
Buyck, C. (2003). Veni, vidi, vici. Air Transport World, 40(3), 27-28. Retrieved from
http://ezproxy.nyack.edu/login?url=http://search.proquest.com/docview/224278417?account
id=38084
Cellular-news.com. (2013, Aug 14). Smartphone Sales Have Overtaken Feature Phone Sales for
First Time. Retrieved from http://www.cellular-news.com/story/61508.php
Cellular-news.com. (2012, Mar 15). Smartphone Battery Life Has Become a Significant Drain
on Customer Satisfaction and Loyalty. Retrieved from http://www.cellularnews.com/story/53523.php
Chen, B., & Lai, Y. (2011). New Digital-Controlled Technique for Battery Charger With
Constant Current and Voltage Control Without Current Feedback. IEEE Transactions On
Industrial Electronics, 59(3), 1545-1553. doi:10.1109/TIE.2011.2167115. Retrieved
January 09, 2013, from EBSCOhost database.
Consumer Electronics Association. (2014, Mar 13). (3). CEA Projects Increase in 2014
Consumer Electronics Accessories Sales. Business Wire (English). Retrieved from
http://web.b.ebscohost.com.ezproxy.nyack.edu/ehost/detail?sid=7e856ad3-d7af-4f918f61-37ed7a7f9683%40sessionmgr113&vid=2&hid=112&bdata
104
Business Plan for a Consumer Electronics Accessories Company
=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bwh&AN=bizwire.c53930114
Consumer Electronics Association. (2013, Jul 19). Innovate :Disruptive Battery Tech.
Retrieved from the Consumer Electronics Association website at
http://www.ce.org/i3/Innovate/2013/July-August/Disruptive-Battery-Tech.aspx
Cooper, M. (2001). BATTERIES NOT INCLUDED. New Scientist, 171(2307), 24. Retrieved
January 09, 2013, from Academic OnFile database at
http://go.galegroup.com.ezproxy.nyack.edu/ps/retrieve.do?sgHitCountType=None&sort=
RELEVANCE&inPS=true&prodId=AONE&userGroupName=nysl_se_nyac&tabID=T0
02&searchId=R9&resultListType=RESULT_LIST&contentSegment=&searchType=Adv
ancedSearchForm&currentPosition=1&contentSet=GALE%7CA79001805&&docId=GA
LE|A79001805&docType=GALE&role=
Croce, W. (2004). Cell phones demand better battery life. Wireless Systems Design, 9(6), 42-46.
Retrieved from http://ezproxy.nyack.edu/login?url=http://search.proquest.com/docview/
212110917?accountid+38084
Curwen, P., & Whalley, J. (2009). Merging incumbent European mobile operators: Veni, vidi,
non vici. Info : The Journal of Policy, Regulation and Strategy for Telecommunications,
Information and Media, 11(4), 34-52. doi:http://dx.doi.org/10.1108/14636690910970964
Diaz, J., Martín-Ramos, J. A., Pernía, A. M., Nuño, F., & Linera, F. (2004). Intelligent and
Universal Fast Charger for Ni-Cd and Ni-MH Batteries in Portable Applications. IEEE
Transactions On Industrial Electronics, 51(4), 857-863. doi:10.1109/TTE.2004.831740.
Retrieved January 10, 2013, from EBSCOhost database.
Erricsson AB. (2013). Ericsson Mobility Report - Interim Update February 2013 (EAB13:009816 Uen A). From Erricsson AB website: http://www.ericsson.com/mobility-report
105
Business Plan for a Consumer Electronics Accessories Company
Erricsson AB. (2014). Ericsson Mobility Report - June 2014 (EAB-14:028658 Uen, Revision A).
Retrieved from Erricsson AB website: http://www.ericsson.com/mobility-report
Evans, M. (2014, July 10). Is It Time To Sell Your Business? 4 Strategies For A Successful Sale Forbes. Retrieved from http://www.forbes.com/sites/allbusiness/2014/07/10/is-it-time-tosell-your-business-4-strategies-for-a-successful-sale/
Following The Trail Of E-Waste. (2009, Aug 27). CBS News. Retrieved from the cbsnews.com
website at http://www.cbsnews.com/news/following-the-trail-of-toxic-e-waste/
Frenzel, L. (2014, March). Deal pushes wireless charging closer to the WPC standard. Electronic
Design, 62(3), 18. Retrieved from
http://go.galegroup.com/ps/i.do?id=GALE%7CA361551018&v=2.1&u=nysl_se_nyac&it
=r&p=GPS&sw=w&asid=204bf28da5b154f97d4dbec556d24149
Froeb, L.M.& McCann, M.T. (2010). Benefits, Costs and Decisions. In Managerial Economics:
A Problem Solving Approach (2nd Ed). pp. 23-39. Mason, OH: South-Western Cengage
Learning
Frommer, D. (2011, Sep 07). 10 Groupon Alternatives You Should Already Know About.
Retrieved from the BusinessInsider.com website at
http://www.businessinsider.com/groupon-alternatives-2011-9?op=1#ixzz35iwxi1qk
Gitman, L.J. & Zutter, C.J. (2012). Principles of Managerial Finance (13th ed.).
Boston, MA: Prentice Hall
Global mobile statistics 2014 Part A: Mobile subscribers; handset market share; mobile
operators. (2014). Mobithinking.com. Retrieved from http://mobithinking.com/mobilemarketing-tools/latest-mobile-stats/a
Google.com (2014, May 30). Retrieved from the Google.com website on May 30, 2014 at
106
Business Plan for a Consumer Electronics Accessories Company
https://www.google.com/#q=smartphone+external+battery
Hagopian, D. (2006, Apr 07). Battery Degradation and Power Loss. BatterShip.com.
Retrieved from the Battery Education website: http://www.batteryeducation.com
/2006/04/battery_degrada.html
Hesselbein, F., Goldsmith, M., & Somerville, I. (2002). Leading for innovation and
organizing for results. Pp. 197-224. Jossey-Bass: San Francisco CA.
Henry, A. (2013, May 23). Best External Battery Pack/Phone Charger? Retrieved from
lifehacker.com website at http://lifehacker.com/best-external-battery-pack-phonecharger-509473009
Horton, J. (2014). Will the landline phone become obsolete? Retrieved from the How
stuffworks.com:http://electronics.howstuffworks.com/landline-phone-obsolete.htm
International Telecommunication Union (2012). Mobile Overtakes Fixed: Implications for Policy
and Regulation Retrieved from website January 09, 2013 at
http://www.itu.int/osg/spu/ni/mobileovertakes/Resources/Mobileovertakes_Paper.
IDTechEx. (2013). Batteries & Supercapacitors in Consumer Electronics 2013-2023: Forecasts,
Opportunities, Innovation. Retrieved from website January 09, 2013 at
http://www.idtechex.com/research/reports/batteries-and-supercapacitors-for-smartportable-devices-2013-2023-markets-technologies-companies-000336.asp
IMSResearch . (2012). Global Wireless Power Market Will See 86.5 Percent Annual Growth to
Reach $45 Billion in 2016 Forecasts IMS Research.IMS Research. Retrieved from
website January 09, 2013 http://www.imsresearch.com/press- release/
Global_Wireless_Power_Market_Will_See_865_Percent_Annual_Growth_to_Reach_45_Bill
ion_in_2016_Forecasts_IMS_Research International Telecommunication Union (2012).
107
Business Plan for a Consumer Electronics Accessories Company
ITU World Telecommunication/ICT Indicators Database-Key Statistical Highlights.
Retrieved from website January 09, 2013 at http://www.itu.int/ITU- D/ict/statistics/
material/ pdf/2011%20Statistical%20highlights_June_2012.pdf
International Telecommunication Union (2012). Mobile Overtakes Fixed: Implications for Policy
and Regulation Retrieved from website January 09, 2013 at
http://www.itu.int/osg/spu/ni/mobileovertakes/Resources/Mobileovertakes_Paper.pdf.
International Telecommunications Union. (2014). ITU releases 2014 ICT figures:
Mobile-broadband penetration approaching 32 per cent Three billion Internet users by
end of this year. Retrieved from the International Telecommunications Union website:
http://www.itu.int/net/pressoffice/press_releases/2014/23.aspx#.U5cKrqJOWP8
Isaacson, W. (2012). The Real Leadership Lessons of Steve Jobs. (cover story). Harvard
Business Review, 90(4), 92-102. Retrieved from
http://web.ebscohost.com.ezproxy.nyack.edu/ehost/detail?sid=90bdb6df-8a06-47c8-aa7ae2345eaf8902%40sessionmgr12&vid=5&hid=26&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3
d#db=buh&AN=73562847
ITU releases new figures in global Internet and mobile access rates. (2014). Satellite Today,
13(89) Retrieved from http://ezproxy.nyack.edu/login?url=http://search.proquest.com/
docview/1525956507?accountid=38084
Kaplan, J. M., & Warren, A. C. (2010). Patterns of Entrepreneurship Management.
Hoboken, N.J., Wiley.
Kaye, L. (2012, Oct 30). Why Metrics Matter in Business Sustainability. Retrieved from
http://www.triplepundit.com/2012/10/metrics-matter-business-sustainability/
Kemp, S. (2014, July 09). Mobile Subscription Penetration / We Are Social. Retrieved from
108
Business Plan for a Consumer Electronics Accessories Company
http://wearesocial.net/?s=mobile+subscription+penetration
Kollorgen, A. (2011). LANDLINE VS MOBILE. Choice, 28-30. Retrieved from
choice.com website at http://www.choice.com.au/reviews-and-tests/electronics/phonesand-mobile-devices/home-phones/do-you-need-a-landline.aspx
Li, J., Mazzola, M.S., Gafford, J., Jia, B., & Xin, M. (2012). Bandwidth based
electrical-analogue battery modeling for battery modules. Journal Of Power Sources,
218331-340. doi:10.1016/j.jpowsour.2012.07.006. Retrieved January 30, 2013, from
EBSCOhost database.
Manjoo, F. (2012, Mar 17). It’s the battery, stupid: The looming 4G smartphone crisis. Retrieved
Jan 19 2013, from pando.com website at http://pando.com/2013/03/17/its-the-battery-stupid/
Mannion, P. (2012). Cell-phone charger: nice idea, bad implementation. Edn, 57(17), 22.
Retrieved January 10, 2013, from EBSCOhost database.
Marketsandmarkets.com. (2012). Wireless Charging Market (2012 – 2017) Global Forecast &
Analysis. Top Market Reports. Retrieved from the marketsandmarket.com website at
http://www.marketsandmarkets.com/Market-Reports/wireless-charging-market-640.html
Marketresearch.com. (2013, Nov 29). Global Heterogeneous Networks Market 2014-2018.
Retrieved from MarketResearch.com at http://www.marketresearch.com/InfinitiResearch-Limited-v2680/Global-Heterogeneous-Networks-7927507/
Market Research Reports.biz.(2012). Batteries and Supercapacitors for Smart Portable Devices
2013-2023: Markets, Technologies, Companies. Retrieved from website January 09,
2013 http://www.marketresearchreports.biz/analysis-details/batteries-andsupercapacitors-for-smart-portable-devices-2013-2023-markets-technologies-companies
Marrison, D. (2004). CE Accessories – Fulfilling The Purposes Of The Purchase. TWICE. This
109
Business Plan for a Consumer Electronics Accessories Company
Week In Consumer Electronics. 19 (22). 49. Retrieved from
http://web.b.ebscohost.com.ezproxy.nyack.edu/ehost/pdfviewer/pdfviewer?sid=7171b647
-c6e9-4bdb-b188-2bfe408b10a7%40sessionmgr115&vid=2&hid=112
Metrics (Definition). Retrieved from Investopedia.com at
http://www.investopedia.com/terms/m/metrics.asp#ixzz2N9zFu4MU
Metrus Group. (2013). People Equity. Retrieved from The Metrus Group website at
http://www.metrus.com/criticalissues/people-equity-full.html
Michael, M. (2013). 2013 CIO Strategy Guide: Top 5 Strategic Issues. Retrieved from
Deadman’s Heartbeat at http://www.deadmanheartbeat.com/community/best-2013-cio
strategies-top-5/
Microwaves&rf. (2012, Jan 25) Wireless Trends Are Revealed For The New Year. Retrieved
from website January 9, 2013 http://mwrf.com/content/wireless-trends-are-revealed-new-year
Miller, F. (2013). Performance Goals for Operations Managers. The Houston Chronicle.
Retrieved from Chron.com at http://smallbusiness.chron.com/performance-goalsoperations-manager-13167.html
Mobile Moves Closer To Universal Charger Solution, Industry Group says 50% fewer
smartphone and mobile device chargers would be manufactured each year to help reduce
greenhouse gases. (2009, Feb 18). InformationWeek. Retrieved from
http://go.galegroup.com/ps/ido?id=GALE%7CA193922343&v=2.1&u=nysl_se_nyac&it
=r&p=AoNE&sw=w&asid=cad7eae7cee6c2abede4ccb2a5bf80b0
Mobithinking.com. (2013). Global Mobile Statistics 2013 Part A: Mobile subscribers; handset
market share; mobile operators. Retrieved from the mobiThinking.com website at
http://mobiThinking.com/mobile-marketing-tools/latest-mobile-stats/a
110
Business Plan for a Consumer Electronics Accessories Company
Moorhead, P. (2014, Feb 19). Has Qualcomm Finally Fixed The Smartphone Charging Problem?
Retrieved from Forbes.com: /2014/02/19/has-qualcomm-finally-fixedthe-smartphone-charging-problem/
Mophie.com. (2014). Shop: Battery Cases. Retrieved from Mophie.com website at
http://www.mophie.com/shop/battery-cases
Mott, N. (2013, Jul 08). BOLT resurrects old tech in the fight against lackluster smartphone
batteries. Pandodaily.com. Retrieved from cellular-news.com at http://www.cellularnews.com/story/60909.php
Nielsen. (2012, May 07).Newswire/America’s New Mobile Majority: A Look At Smartphone
Owners in the U.S. / Nielsen. Retrieved from
http://www.nielsen.com/us/en/insights/news/2012/who-owns-smartphones-in-the-us.html
Nielsen. (2014, Mar 14).Newswire. Multiplying Mobile: How Multicultural Consumers Are
Leading Smartphone Adoption. Nielsen. Retrieved from
http://www.nielsen.com/us/en/insights/news/2014/multiplying-mobile-how-multiculturalconsumers-are-leading-smartphone-adoption.html
Newcombe, T. (2013, Dec 03). As landline phones disappear, some voice concerns. McClatchyTribune Business News. Retrieved from http://ezproxy.nyack.edu/login?url=http://
search.proquest.com/docview/1464693220?accountid=38083
Nunes, P. & Breene, T. (2011, Jan). Reinvent Your Business Before It’s Too Late.
Harvard Business Review. Retrieved from Harvard Business Review website at
http://hbr.org/2011/01/reinvent-your-business-before-its-too-late
Olesky, J. (2012). Diminishing returns, diminishing awareness. Professional Safety, 57(12), 18.
Retrieved from http://ezproxy.nyack.edu/login?url=http://search.proquest.com/
111
Business Plan for a Consumer Electronics Accessories Company
docview/1243501668?accountid=38084
Opeyemi, O., & Hassan, F. (2012). Energy Systems Maintenance. Energy & Power Engineering,
4(1), 8-18. doi:10.4236/epe.2012.41002. Retrieved January 10, 2013, from EBSCOhost
database
Panasonic Industrial Devices. (2014). Batteries OEM & Industrial; Primary Coin & Cylindrical
(Coin Type BR & CR). Retrieved from the Panasonic Industrial Devices Sales Company
of America website at http://www.panasonic.com/industrial/batteries-oem/oem/primarycoin-cylindrical/br-cr.aspx
PC Magazine. (2014, May 07). The 10 Best Smartphone./ PCMag.com. Retrieved from
http://www.pcmag.com/article2/0,2817,2367064,00.asp
Phillips, I. (2014). How to Figure Out the Weighted-Average Contribution Margin. Retrieved
from the Houston Chronicle website at http://smallbusiness.chron.com/figure-outweightedaverage-contribution-margin-56118.html
Phonescoop.com. (2014). Glossary:mAh. Retrieved from the phonescoop.com website at
http://www.phonescoop.com/glossary/term.php?gid=194
Prahalad, C., Krishman, M. (2008). The New Age of Innovation: Driving Co-created Value
Through Global Networks. (pp. 108-145). New York: NY, McGraw-Hill/Irwin.
PricewaterhouseCooper. (2011, Nov.). The consumerization of IT- The next-generation CIO.
Retrieved from http://www.pwc.com/us/en/technology-innovationcenter/consumerization-information-technology-transforming-cio-role.jhtml
Quinn, G. (2013, Aug 26). GAO Report Unmasks the Mythical Patent Troll Problem.
IPWatchdog.com. Patents & Patent Law. Retrieved from the IPWatchdog.com website at
http://www.ipwatchdog.com/2013/08/26/gao-report-unmasks-patent-troll-
112
Business Plan for a Consumer Electronics Accessories Company
problem/id=44818/
Raban, S. (2011, Aug 18). The Benefits of ERP Software for Small or Medium Size
Businesses. Retrieved from http://www.xtuple.org/node/4394
Rahman, S. (1997). Battery chemistries challenge charger designers. Electronic News
(10616624), 43(2185), 70. Retrieved January 10, 2013, from EBSCOhost database
Raftery, T. (2012, Mar 19). Battery life: The smartphone industry's Achilles heel? Retrieved
from The Week website at https://theweek.com/article/index/225738/battery-life-thesmartphone-industrys-achilles-heel
Reed, B. (2014, May 15). Brilliant new app may help you squeeze every last drop from your
smartphone’s battery. Retrieved from Boy Genius Report at
http://bgr.com/2014/05/15/smartphone-battery-life-app-battery-plus/
Researchandmarkets.com. (2012). Global Accessories and Peripherals for Smartphones and Tablets Market
2012-2016. TechNavio Infiniti Research Ltd. Retrieved from the ResearchandMarkets.com
website at http://www.researchandmarkets.com/research/zqs235/global
Russell, T. (2014, May 13). Soon, Everything Will Be A Charger. Popular Science Magazine.
Retrieved from the Popular Science Magazine website at
http://www.popsci.com/article/gadgets/soon-everything-will-be-charger
Schiemann, W.A. (2009). Reinventing Talent Management: How to Maximize Performance in
the New Marketplace. Wiley & Sons, Inc., Hoboken, NJ. pp. 9-22, 43-57.
Singer, P. (2008, Jan 24). Get a charge on the go. Wall Street Journal. Retrieved from
http://ezproxy.nyack.edu/login?url=http://search.proquest.com/docview/399019431?acco
untid=38084. Retrieved January 10, 2013, from ProQuest database.
113
Business Plan for a Consumer Electronics Accessories Company
Sims, P. (2010, Dec 31). Did a mobile phone charger start the fire that killed 3 children?
Daily Mail. p. 33. Retrieved from
http://web.b.ebscohost.com.ezproxy.nyack.edu/ehost/detail?sid=bfa20db8-8d53-4c18867d-f89f96bd6a96%40sessionmgr112&vid=5&hid=
112&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bwh&AN=56685525
Smith, B. (2003). Boosting the power. Wireless Week, 9(15), 6-8. Retrieved from
http://ezproxy.nyack.edu/login?url=http://search.proquest.com/docview/195492332?acco
untid=3808
Sperling, G. (2013, Jun 04). Taking on Patent Trolls to Protect American Innovation. The White
House Blog. Retrieved from The White House Blog website at
http://www.whitehouse.gov/blog/2013/06/04/taking-patent-trolls-protect-americaninnovation
Spinnelli, S. & Adams, R. (2012). New Venture Creation (Ninth Ed.). The McGraw-Hill/Irvin.
New York, NY. Pp 35-53.
Svensson, P. (2013, Jul 08). Telecommunication companies plan to phase out landline phones.
masslive.com. Retrieved from
http://www.masslive.com/news/index.ssf/2013/07/telecommunication_companies_pl.htm
Talbot, D. (2014, Feb 27). A New Push to Solve Wireless Charging. MIT Technology Review,
Communications News. Retrieved from the MIT Technology Review website at
http://www.technologyreview.com/news/524976/a-new-push-to-solve-wireless-charging/
Taylor, B. (2010, July 15). Determining Your Company’s Value: Multiples and Rules of Thumb.
Retrieved from boss.blogs.nytimes.com/2010/07/15/determining-your-companys-valuemultiples-and-rules-of-thumb/?_php=true&_type=blogs&_php=true&_type=blogs&_r=1
114
Business Plan for a Consumer Electronics Accessories Company
The Lithium Battery Recycling Challenge. Waste Management World (2014). Retrieved from
Waste Management World website at http://www.waste-managementworld.com/articles/print/volume-12/issue-4/features/the-lithium-battery-recyclingchallenge.html
Top Categories of Cell Phone Accessories, 2011-2012. Market Share Reporter. Detroit: Gale,
2012. Business Insights: Essentials. Web. 7 Oct. 2013. Document URL
http://bi.galegroup.com/essentials/article/GALE%7CI2502041895/7015871cfbfee3fed5d
7019eb9c70f64?u=nysl_se_nyac
TrendsSpotting Trends Research. (2012, Jan). Trends and Innovations in Mobile Accessories.
Retrieved from the slideshare.net at http://www.slideshare.net/TrendsSpotting/trendsand-innovations-in-mobile-accessories-by-trendsspotting
Tsuruoka, D. (2013, Mar 05). Amazon.com profit margins will be buoyed by prime. Investor's
Business Daily Retrieved from
http://ezproxy.nyack.edu/login?url=http://search.proquest.com/docview/1314603003?acc
ountid=38084
Verizon Wireless. (2014). The Future of Wireless Charging. Verizon News Center. Retrieved
from verisonwireless.com website at
http://www.verizonwireless.com/news/article/2012/12/smartphones-wirelesscharging.html
Wang Z, M Gu, Y Zhou, X Zu, JG Connell, J Xiao, D Perea, LJ Lauhon, J Bang, S Zhang, C
Wang, and F Gao. (2014, Mar 07). Too many electrons at the lithiation front in silicon are
a problem. "Electron-Rich Driven Electrochemical Solid-State Amorphization in Li-Si
Alloys." 2013. Nano Letters 13(9):4511-4516. Retrieved from Psy.org website at
115
Business Plan for a Consumer Electronics Accessories Company
http://phys.org/news/2014-03-electrons-lithiation-front-silicon-problem.html#jCp
Wayner, P. (2007, Jun 28). A portable battery-powered charger for cellphones, music or games
can avert an energy crisis. New York Times. Retrieved from
http://ezproxy.nyack.edu/login?url=http://search.proquest.com/docview/433599678?acco
untid=38084. Retrieved January 10, 2013, from ProQuest database
Wilkerson, K. (2011, Apr 21). Are Cell Phones Replacing Landlines in Popularity?
Technology.gather.com. Retrieved from gather.com website at
http://technology.gather.com/viewArticle.action?articleId=281474979249749
Woojoo L., Yanzhi W, Donghwa S., Chang, N., Pedram, M. (2014)."Optimizing the Power
Delivery Network in a Smartphone Platform," Computer-Aided Design of Integrated
Circuits and Systems, IEEE Transactions on , vol.33, no.1, pp.36,49, Jan. 2014 doi:
10.1109/TCAD.2013.2282287. Retrieved from IEEE Xplore Digital Library at
http://ieeexplore.ieee.org/stamp/stamp.jsp?tp=&arnumber=6685857&isnumber=6685848
Wright, J. D., & Ginsburg, D. H. (2014). PATENT ASSERTION ENTITIES AND
ANTITRUST: A COMPETITION CURE FOR A LITIGATION DISEASE?
Antitrust Law Journal, 79(2), 501-526.
Retrieved from http://ezproxy.nyack.edu/login?url=http://search.proquest.com/
docview/1539427920?accountid=38084
Yiannaka, A. (2009). When less is more: Optimal patent breadth under the threat of patent
validity challenges. Southern Economic Journal, 75(4), 1067-1093. Retrieved from
http://ezproxy.nyack.edu/login?url=http://search.proquest.com/docview/212147169?accountid =38084
Yoder, S. (2013). Business Strategies for Information Technology. Retrieved from eHow.com:
http://www.ehow.com/list_6165578_business-strategies-information-technology.html#ixzz2bI91lGdY